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 / Updated  / Source: Reuters

An insulin pill would cost a lot to make, and consumer would not be willing to pay enough for it it make it a worthwhile effort, a drug company CEO says.

An insulin pill that would save diabetics from daily injections has long been seen as the "holy grail" of diabetes care, yet Novo Nordisk announced last month it was throwing in the towel after several years of work.

Insulin Prices Skyrocket

Nov. 17, 201602:52

"We actually made a phenomenal scientific achievement in demonstrating to ourselves it is possible to have an insulin tablet," Chief Executive Lars Rebien Sorensen told an industry conference.

"The problem is that in the reimbursement market we are now facing it is unlikely that such a tablet could be made available at a price that would be acceptable to the payers."

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Novo's decision to scrap the insulin pill program came as the company slashed its long-term profit growth forecast due to falling U.S. insulin prices.

Delivering a protein like insulin as a pill is hard because it can be destroyed in the stomach. Novo scientists overcame this obstacle to a degree but still needed to deliver around 50 times more insulin in a tablet than in an injection to ensure a sufficient dose.

As a result, the insulin pill in development would have needed to cost far more than a standard injection.

While a big premium for convenience might have been commercially viable once in the lucrative U.S. market, it would not be viable today, given the squeeze on prices by pharmacy benefit managers, who administer drug programs for health plans.

Sorensen said the tablet concept, which is also being pursued by Israel's Oramed Pharmaceuticals, might yet be revisited by Novo if its scientists found a way to make a cheaper version needing less insulin.

Despite the setback in oral insulin, Novo still has high hopes for another pill: an oral version of a GLP-1 class of medicine that stimulates insulin production in the pancreas.

Injectable forms of GLP-1, led by Novo's Victoza, are already well-established and a pill could allow them to be given to patients earlier and more widely.

Significantly, the amount of GLP-1 drug needed in a pill is not that much greater than in an injection, so Sorensen believes an oral version could be viable if priced around the same level as a GLP-1 injection.

If all goes well, an oral form of Novo's next-generation GLP-1 semaglutide could reach the market around 2020. Novo is investing $1.85 billion in a factory in Clayton, North Carolina that will make oral semaglutide and other products.