SKB strikes Avandia deal after approval

SMITHKLINE BEECHAM yesterday said it had struck a deal with US competitor Bristol-Myers Squibb to co-promote Avandia, the blockbuster diabetes drug given approval by US authorities this week.

On Wednesday SKB was given the green light to sell the drug by the US Food and Drug Administration's advisory panel, giving it access to the multi-billion dollar market for diabetes treatments.

The FDA ruled the drug was free of any links to unusual liver damage, giving SKB a crucial marketing edge over some type 2 diabetes treatments.

Yesterday a fierce battle for market share was in prospect when the FDA said Actos, a rival to Avandia produced by Eli Lilly and Takeda Chemical, was also not linked to liver damage.

Type 2 diabetes, a condition caused by the inability of the body to respond to natural insulin, affects around 100 million people across the world and 16 million in the US, most of them in the older age brackets.

Type 2 diabetes is the leading cause of adult blindness and kidney failure in the US. The conditions and its complications cause around 500 deaths a day in the US alone.

The new drugs help to reduce insulin resistance and allow the body to control its own blood-sugar level. SKB has completed more than 20 clinical trials involving 500-plus patients.

Rezulin, the rival drug developed by Warner Lambert, is expected to realise sales of $750m (pounds 465m) in spite of being linked to serious liver damage. The FDA allows the drug to be prescribed, but only alongside other treatments. Avandia can be used on its own.

Analysts expect Avandia and Actos to realise sales of $3bn between them within four years. Until now there were fears that these might also cause liver problems.

SKB's collaboration with Bristol-Myers Squibb will give Avandia an extra marketing push. Bristol-Myers is currently the market leader in diabetes treatments through its Glucophage product.

Howard Pien, president of SmithKline Beecham Pharmaceuticals, said: "Given the extensive experience of Bristol-Myers Squibb in bringing Glucophage to patients with type 2 diabetes, [we] understand well the urgent need to provide physicians with additional new therapeutic options."