Lantus Cancer Risk Inconclusive: Good News for Sanofi-Aventis?

At last, the uncertainty regarding Sanofi-Aventis' (SNY) Lantus (generic name insulin glargine) seems to be over. Today, the company released a statement by a board of experts regarding the potential link of Lantus with increased cancer risk. They have come to the conclusion that all the four cases had significant methodological limitations and shortcomings, thus making the results inconclusive.

As a reminder, in the month of June, a study by the European Association for the Study of Diabetes observed that Lantus (generic name insulin glargine) increases the risk of cancer in diabetics taking the drug. The study, carried out on 127,000 patients in four European countries found that out of every 100 patients using Lantus for about 1 1/2 years, one additional person developed cancer.

But the FDA was not convinced with the study as patients were not studied long enough to substantiate the risk. Accordingly, it planned to review the safety data of Lantus including the new study. The FDA has declared that it will continue its discussions with the company to decide the requirement of any additional safety and effectiveness trial. Sanofi, on its part decided to extend any kind of help to the FDA to resolve this issue. The recommendation of the experts all the more emphasizes FDA’s viewpoint that no definite conclusion can be drawn from the studies.

Lantus is an important product for Sanofi, its third-best-selling drug and a key growth driver as its other key drugs, blood thinners Plavix and Lovenox are likely to face possible generic competition. Lantus recorded revenue of $3.5 billion in 2008, an increase of 28% over last year.

Earlier this month, Sanofi announced the result of a 5 year study (on 1024 patients) of Lantus versus NPH insulin on progression of retinopathy (a major cause of blindness among diabetic patients) in patients with type 2 diabetes. According to the study, overall survival along with the effect of retinopathy was similar in both the groups.

Adverse publicity for Lantus could turn away patients to other drugs such as Novo Nordisk’s (NVO) long-acting insulin Levemir, Amylin’s (AMLN) Byetta and Merck’s (MRK) Januvia and Janumet hitting its topline. We have a Hold recommendation on Sanofi.