Singapore, Nov 10, 2009: The number of Australians with diabetes is estimated to be about 1 million; a number that is rising as obesity becomes more widespread and the population ages.
According to independent market analyst Datamonitor, the Australian insulin market will continue to be governed by long- and fast-acting brands, particularly Sanofi-Aventis’s Lantus and Novo Nordisk’s NovoRapid. The non-insulin market, however, will see some change as thiazolidinedione’s leading position is taken over by the incretin mimetics class. Nevertheless, improving on the limited or lack of reimbursement will be key for incretin mimetic brands Januvia (Merck) and Byetta (Eli Lilly).
According to a new report titled “Commercial Insight: Antidiabetics in Australia – Reimbursement status shapes novel classes, October 2009” by Datamonitor, there are around 1 million diabetes patients in Australia, a number that is thought to be both an underestimation and likely to increase in the future. The rise in diabetes in Australia will be chiefly driven by individuals developing type 2 diabetes linked to the obesity epidemic seen in Australia. However, there are also signs that the incidence of those with type 1 diabetes has been increasing and will continue to do so.
Like many other developed countries, Australia has a rapidly aging population, which will contribute to the rise in diabetes as well. “An additional challenge is that diagnosis of type 2 diabetes is particularly problematic in older people. In such cases, the individual, their family and carers may not pay attention to symptoms of chronic thirst and frequent urination, considering them to be related to old age,” says Ms Lisette Oversteegen, senior healthcare analyst with Datamonitor.
In 2008, total sales in the antidiabetic market in Australia reached nearly $233 million, demonstrating an overall compound annual growth rate of 17.9% between 2004 and 2008. This growth was mainly driven by the above mentioned increase in diabetic population, as well as the continued uptake of more expensive brands.
Within the insulin market, the combination of a fast-acting product after each meal and a daily injection of a long-acting insulin brand (basal-bolus regimen) has become highly successful in replacing older therapies. It is therefore not surprising that, in terms of sales, Sanofi-Aventis’s long-acting Lantus (insulin glargine) and Novo Nordisk’s fast-acting NoroRapid (insulin aspart) headed up the class in 2008, with sales of $47 million and $23 million, respectively.
The Australian non-insulin market has been more dynamic over the past 5 years, with novel incretin mimeticsdipeptidyl peptidase-IV (DPP-IV) inhibitors and glucagon-like peptide-1 (GLP-1) agonistsbeing launched. Although the thiazolidinedione class was the fastest growing class between 2004 and 2008, its sales stagnated between 2007 and 2008 when a prominent meta-analysis suggested that GlaxoSmithKline’s Avandia (rosiglitazone) was associated with an increased risk of myocardial infarction.
The insulin and non-insulin markets are expected to grow considerably in the next decade Novo Nordisk currently dominates the insulin market and will continue to do so in the years to come. A positive relationship with physicians is important in the insulin market, as physicians are traditionally loyal to brand and company. With several products on the market, Novo Nordisk is able to provide physicians with a complete suite. Even though its long-acting insulin Levemir (insulin detemir) is expected to remain second-line compared with competitor Lantus, strong growth across its insulin franchise ensures the company’s control of the market until after the forecast period.
Future growth of the non-insulin antidiabetic market is expected to be strong on the back of the market's epidemiological growth, an extensive pipeline and a large number of pipeline candidates reaching the market. The thiazolidinediones will make place for the more expensive incretin mimetics and their fixed-dose combination products, which will account for 43% of total non-insulin sales by 2018. The first incretin mimetic that was launched in Australia in 2007 is twice-daily injectable Byetta (Eli Lilly), which is more than twice as expensive as the average thiazolidinedione. A second incretin mimetic, Merck’s once-daily Januvia pill, came to market in 2008 and costs about the same as a thiazolidinedione.
“Events that will hamper market growth include several key patent expiries, with the thiazolidinedione class of molecules losing patent protection from 2011 onwards,” Ms Oversteegen adds.
Whether the incretin mimetics class will indeed take over the non-insulin market will depend on their level of reimbursement via the Pharmaceutical Benefits Scheme (PBS). The government’s efforts to reduce healthcare spending mean that the cost-effectiveness of a new medicine is increasingly scrutinized before being added to the PBS. The Australian Department of Health, which evaluates applications for listing, only allows reimbursement of a more expensive drug if it deems the product to be more effective or safer than what is already available.
In the case of DPP-IV inhibitor Januvia, the Department of Health only allowed the drug to be reimbursed via the PBS when used in dual therapy with metformin or a sulfonylurea when a combination of metformin and a sulfonylurea is contraindicated. However, Januvia is not reimbursed for use earlier in the treatment pathway where it replaces a sulfonylurea in dual combination with metformin, as Merck had requested. This has resulted in sales of only $3 million in Australia in 2008, much lower than in the US, where Januvia reached sales of $1.1 billion in the same year. Key opinion leaders interviewed for Datamonitor’s report on diabetes in Australia state that Januvia would be used much more widely if reimbursement was to be improved.
For Eli Lilly’s Byetta, the situation is even more dire, with sales in 2008 only reaching $1 million compared with $640 million in the US. Three submissions made by the company to get its product listed on the PBS have so far failed, which means that patients need to pay for this drug themselves. The crux of the problem lies in the number of units of insulin glargine that Byetta should be compared with in order to determine its list price. While the Department of Health feels that Byetta is most cost-effective when sold at the price of 25-27 units of insulin glargine, Eli Lilly feels that a comparison with 75 units per day is more appropriate. Key opinion leaders interviewed for this report on the Australian anti-diabetics market said that the truth is probably somewhere in the middle.
Ms Oversteegen said, “…it is likely that further negotiations between Eli Lilly and the Australian government will result in a lower price for Byetta, which will allow it to be reimbursed via the PBS. A failure to do so will have grave consequences not only for Byetta’s sales, but also for GLP-1 agonists in the pipeline.”
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