Amgen, Inc. (AMGN), Bristol Myers Squibb Co. (BMY): Is Merck & Co., Inc. (MRK)’s Type 2 Diabetes Blockbuster in Trouble?

It’s still too early to project how doctors will change their prescriptions to patients in light of the new data, but the competition isn’t making the decision any easier. Johnson & Johnson (NYSE:JNJ) is hoping to gain approval for its first-in-class SGLT-2 type 2 diabetes drug. Not only did the therapy beat Januvia in lowering glucose levels and weight loss (not an endpoint, but a welcomed feature for patients nonetheless), but it is not expected to increase pancreatitis risks. A fast start for the projected blockbuster will put Merck & Co., Inc. (NYSE:MRK) on edge.

Future competition may come from Forxiga, another drug in the SGLT-2 class, from Bristol Myers Squibb Co. (NYSE:BMY) and AstraZeneca plc (ADR) (NYSE:AZN). The FDA gave the new therapy a thumbs-down over cancer concerns, but the agency is going to reconsider it later this year. And as fellow Fool Sean Williams pointed out not too long ago, an even newer class of type 2 diabetes drugs may have a promising future: glucokinase activators, such as AMG 151 from Amgen, Inc. (NASDAQ:AMGN) and Array Biopharma Inc (NASDAQ:ARRY). The experimental drug is still a few years away from hitting the market, but has shown promise in quickly reaching maximum efficiency in patients.

Foolish bottom line
What does it all mean for Merck & Co., Inc. (NYSE:MRK)? The new safety data are not a good sign. Usually skeptical about assigning new drugs as first-line treatments, physicians may be inclined to turn to Invokana for patients at higher risk of developing pancreatitis from Januvia. It is still too early to tell how — or even if — Januvia’s growth will be affected, but it is something investors will want to pay close attention to for the next several quarters.

The article Is Merck’s Type 2 Diabetes Blockbuster in Trouble? originally appeared on Fool.com and is written by Maxxwell A.R. Chatsko.

Fool contributor Maxx Chatsko has no position in any stocks mentioned. Check out his personal portfolio, his CAPS page, or follow him on Twitter @BlacknGoldFool to keep up with his writing on energy, bioprocessing, and emerging technologies.The Motley Fool recommends Johnson & Johnson. The Motley Fool owns shares of Johnson & Johnson.

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