Dear Valued Visitor,

We have noticed that you are using an ad blocker software.

Although advertisements on the web pages may degrade your experience, our business certainly depends on them and we can only keep providing you high-quality research based articles as long as we can display ads on our pages.

To view this article, you can disable your ad blocker and refresh this page or simply login.

We only allow registered users to use ad blockers. You can sign up for free by clicking here or you can login if you are already a member.

Will Johnson & Johnson (JNJ) Win Approval for Its Diabetes Drug?

In addition to its well-known personal-care products such as Listerine and Neutrogena, Johnson & Johnson (NYSE:JNJ) boasts an impressive portfolio of market-leading therapeutic compounds. In fact, the health-care leader was one of the few to show growth last year in both worldwide pharmaceutical sales ($25 billion) and earnings ($3.86 per share). It finds itself in an enviable position heading into 2013 as one of the best-positioned companies to tackle the patent cliff head-on.

Even with that recent success, though, there’s no time for J&J to rest on laurels in the highly competitive landscape of pharma and biotech. Even the industry’s most successful drugs are under constant pressure from generics, which are either already on the market or timing their entrance for the moment exclusivity is lost. Fortunately for J&J, 2012 showed that several new drugs are already shaping up to be critical driving forces in the company’s future. Today, we’ll look at the Type 2 diabetes drug-hopeful Invokana.

Johnson & Johnson (JNJ)The future of Type 2 diabetes treatment?
Invokana (canagliflozin) is a small molecule that inhibits the SGLT2 protein, which is responsible for transporting and retaining glucose in the kidney and thereby lowers glucose levels in diabetic patients. At the beginning of the year, an FDA advisory committee voted 10-to-5 in favor of approving the drug for patients with Type 2 diabetes, and final approval is expected by the end of the first quarter.

The same panel also voted 8-to-7 that it had concerns over the drug’s long-term cardiovascular effects, but while the final vote will require additional safety data, it’s unlikely that approval will be deraild. In fact, J&J has an ongoing trial evaluating long-term cardiovascular safety, which is expected to be completed in 2015. That should suffice for now.

The U.S. market is wide open
Approval would grant Invokana exclusive access to the U.S. market as the only approved SGLT2 inhibitor. Bristol Myers Squibb Co. (NYSE:BMY) and AstraZeneca plc (NYSE:AZN) took a crack at the 26 million Americans with Type 2 diabetes last January with its SGLT2 inhibitor Forxiga (dapagliflozin), only to be denied approval over cancer risk concerns. Despite the setback, the drug was approved in the European Union in November.

The potential for J&J is enormous. Consider that Merck & Co., Inc. (NYSE:MRK) generated more than $5.75 billion in worldwide sales last year with its Type 2 diabetes blockbusters Januvia and Janumet. Better yet, the company maintains that the largest drivers for growth were the U.S. and Japanese markets.

Oh, yeah — Invokana also went head to head against Januvia in recent trials and won. That gives Johnson & Johnson an impressive track record in taking down market-leading drugs, considering that the company’s immunology drug Stelara also recently crushed Enbrel in a head-to-head study. Both drugs are great news for the company, but they represent small pieces of the entire story. And there appears to be plenty for investors to like.

The article Will Johnson & Johnson Win Approval for Its Diabetes Drug? originally appeared on and is written by Maxx Chatsko.

Fool contributor Maxx Chatsko has no position in any stocks mentioned. The Motley Fool recommends and owns shares of Johnson & Johnson.

Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

DOWNLOAD FREE REPORT: Warren Buffett's Best Stock Picks

Let Warren Buffett, George Soros, Steve Cohen, and Daniel Loeb WORK FOR YOU.

If you want to beat the low cost index funds by 19 percentage points per year, look no further than our monthly newsletter.In this free report you can find an in-depth analysis of the performance of Warren Buffett's entire historical stock picks. We uncovered Warren Buffett's Best Stock Picks and a way to for Buffett to improve his returns by more than 4 percentage points per year.

Bonus Biotech Stock Pick: You can also find a detailed bonus biotech stock pick that we expect to return more than 50% within 12 months.
Subscribe me to Insider Monkey's Free Daily Newsletter
This is a FREE report from Insider Monkey. Credit Card is NOT required.