Not only did Sanofi ($SNY) snag an EU recommendation for its Lantus follow-up drug Toujeo just two days after the FDA approved it, but regulators in Europe also gave the drug a bit of a kiss that the FDA did not. They noted that it is better at preventing low blood sugars.
"In Type 2 diabetes patients, the incidence of confirmed hypoglycemia was lower with Toujeo, in particular at night, as compared to insulin glargine 100 U/ml (Lantus)," the Committee for Medicinal Products for Human Use (CHMP) said in recommending that the European Medicines Agency approve the drug. As Reuters points out, the EMA usually follows a CHMP recommendation within a couple of months.
A successful launch of Toujeo is essential for Sanofi as well as being seen as a litmus test for how well its new CEO Olivier Brandicourt can perform. Lantus is Sanofi's best-selling drug and the world's most-prescribed insulin with $7 billion in 2014 sales. But the powerhouse insulin is already seeing market share erosion from some newer drugs and is going off patent next year with a biosimilar already being positioned to take it on.
Sanofi hopes to move Lantus users to Toujeo, which uses the same active ingredient as Lantus, insulin glargine, at triple the concentration but which it releases more gradually to even out blood sugar levels. Sanofi had counted on the label for Toujeo to mention its improved control of hypoglycemia, particularly at night, but the FDA did not include it. That means Sanofi will have a harder time convincing doctors that there is an advantage for them to switch their patients, particularly since both the FDA and the EU labels will point out that a higher dosage of Toujeo may be needed to achieve the target blood sugar ranges.
One way Sanofi is expected to soften the beaches with doctors is with competitive pricing. The French drugmaker has indicated that Toujeo will cost about same as Lantus, forsaking the usual premium. Some analysts think Sanofi may need to go a step further. That would mean offering the drug at a discount to provide added impetus to move patients off of Lantus ahead of a biosimilar, which will be cheaper than Lantus.
"We've said all along that price will not be a barrier to access," Pierre Chancel, senior vice president for diabetes at Sanofi, told the Financial Times. The marketing strategy, he said, is to show Toujeo is better than Lantus.
It will be a steep climb for Toujeo, and Brandicourt, to make up for projected sales declines of Lantus as copies hit the market. Peter Verdult, an analyst at Citigroup told the Financial Times he thinks Toujeo could hit sales of €560 million ($627.4 million) in 2016 and by 2020 reach €2 billion ($2.2 billion).
"It remains an imperative for Sanofi to execute a successful switch from [Lantus] … and give the market belief that the diabetes franchise can sustain growth," Verdult said.