Analysts see U.S. approval of Novo Nordisk's obesity drug by year-end

[October 21, 2014]  COPENHAGEN (Reuters) - The U.S. Food and Drug Administration is likely to approve Novo Nordisk's new drug to treat obesity this year, analysts said after wide expectations of an FDA decision late on Monday were not met.

Danish drugmaker Novo Nordisk applied for approval for liragludtide, under the name of Saxenda, on Dec. 20 last year. Monday, exactly 10 months after the filing, was seen by analysts as a deadline for a decision from FDA about approval.[ID:nWEB00G4Y]

FDA has set a goal to process applications for approvals within 10 months but there are examples when they spend more than that on applications.

"We feel sure they are working on it and expect to hear from them when they have finished their work," head of communications Mike Rulis from Novo Nordisk said.
 

Analysts from brokerage firm Citi have estimated peak sales of Saxenda at around $1.5 billion and they see an approval coming. Nordea and Sydbank analysts also believe that the FDA's silence on Monday should not cause concern.

"We (...) still expect it (approval) to arrive before the end of the year, enabling a 2015 launch of Saxenda," Nordea analyst Michael Novod said in a note.

"The approval from FDA could be given together with a requirement of some kind of follow-up studies that shows how patients react to the drug," Sydbank analyst Soren Lontoft said.

Shares in Novo Nordisk were up 0.5 percent at 0947 GMT (0547 EDT) while the Copenhagen main index was up 2.15 percent.

Nordea has a target price of 335 crowns and a strong buy recommendation on Novo Nordisk's shares.

(Reporting by Ole Mikkelsen, editing by Anna Ringstrom and Sabina Zawadzki)

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