FDA Proposes Limiting Compounding of Obesity Drugs
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 4 days ago
0mins
Source: CNBC
- FDA Proposal Impact: The FDA's proposal to exclude the active ingredients of Novo Nordisk and Eli Lilly's obesity and diabetes medications from the compounding list could significantly limit the mass compounding of these drugs, potentially leading to higher costs for patients if finalized.
- Clinical Need Assessment: The FDA stated that there is 'no clinical need' for outsourcing facilities to compound these medications from bulk substances, emphasizing that when FDA-approved drugs are available, compounding is not lawful unless a clear clinical need exists, which may affect drug availability in the market.
- Market Response: Novo Nordisk and Eli Lilly have invested billions over recent years to ramp up manufacturing capacity to alleviate supply constraints, while also making efforts to enhance the affordability of their branded medications to attract users who previously opted for cheaper compounded alternatives.
- Regulatory Scope Clarification: The proposal specifically targets 503B outsourcing facilities that manufacture compounded drugs in bulk without prescriptions, while not affecting 503A pharmacies that compound based on individual prescriptions, indicating a tightening of FDA oversight in the compounding market.
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Analyst Views on NVO
Wall Street analysts forecast NVO stock price to rise
8 Analyst Rating
4 Buy
3 Hold
1 Sell
Moderate Buy
Current: 44.390
Low
42.00
Averages
54.67
High
70.00
Current: 44.390
Low
42.00
Averages
54.67
High
70.00
About NVO
Novo Nordisk A/S is a global healthcare company engaged in diabetes care. The Company is also engaged in the discovery, development, manufacturing and marketing of pharmaceutical products. The Company operates through two business segments: diabetes and obesity care, and biopharmaceuticals. The Company's diabetes and obesity care segment covers insulin, GLP-1, other protein-related products, such as glucagon, protein-related delivery systems and needles, and oral anti-diabetic drugs. The Company's biopharmaceuticals segment covers the therapy areas of hemophilia care, growth hormone therapy and hormone replacement therapy. The Company also offers Saxenda product to treat obesity. It offers a range of products, including NovoLog/NovoRapid; NovoLog Mix/NovoMix; Prandin/NovoNorm; NovoSeven; Norditropin, and Vagifem. As of December 31, 2016, it marketed its products in over 180 countries. Its regional structure consists of two commercial units: North America and International Operations.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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