Novo Nordisk takes inhaled insulin in-house

Novo Nordisk has acquired full development and marketing rights to the AERx insulin Diabetes Management System (iDMS), designed to allow patients with diabetes to take their medication using an inhaler, rather than by self-injection.

The race to develop the first inhaled insulin treatment for diabetes is stepping up, particularly as an early lead for Pfizer and Nektar's Exubera product now seems to have been eroded. Exubera has been held back by regulatory anxieties over the long-term safety of the approach, although data reported earlier this month could provide some comfort.

Another inhaled insulin drug from Alkermes and Eli Lilly has just started Phase III testing, while another players in the sector is MannKind (Phase II). Analysts have predicted that the first inhaled insulin product to reach the market could achieve sales upwards of $1.5 billion (€1.2bn) a year.

Under the terms of their latest agreement, Novo Nordisk will purchase manufacturing equipment and leasehold improvements currently utilised by Aradigm in the AERx iDMS programme for an estimated $55 million in cash.

The Danish company will assume all further responsibilities for AERx(R) iDMS development and funding, with Aradigm's role truncated. However, it will receive an adjusted royalty on any future AERx iDMS net sales.

As a result of the expanded licensing agreement, Novo Nordisk has formed a new affiliate, Novo Nordisk Delivery Technologies, based in Hayward, California, which will assume the leases and operational overhead on two of Aradigm's current three buildings, and will offer employment to approximately 130 Aradigm employees who have been dedicated to the iDMS project.

The companies also have the option to continue collaborating in specific areas such as next-generation AERx technologies. And if needed, Novo Nordisk will provide certain contract manufacturing services to support other AERx programmes for up to three years.

The agreement is expected to close by the end of 2004.