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GlaxoSmithKline’s (GSK - Analyst Report) diabetes drug, Eperzan, gained approval in the EU. The European Commission (EC) approved the once-weekly drug both as a monotherapy and as combination therapy in adults suffering from type II diabetes.

The EC approved Eperzan on the basis of encouraging data from eight phase III trials on Eperzan. Glaxo expects to launch the drug in the third and fourth quarters this year in several countries in Europe. Launches are expected to continue thereafter in other European countries.

The approval did not come as a surprise as the European Medicines Agency’s Committee for Medicinal Products for Human Use had rendered a positive recommendation on Eperzan earlier this quarter.

Our Take

Eperzan is a long-acting glucagon-like peptide 1 (GLP-1) receptor agonist. Its once-weekly treatment regimen for type II diabetes provides patients with a more convenient treatment option over the daily dosing regime of GLP-1 products including Novo Nordisk’s (NVO - Analyst Report) Victoza among others. Currently, Bydureon is the only GLP-1 receptor agonist which has once weekly dosing.

 However, several big pharma companies like Novo Nordisk (semaglutide) and Eli Lilly and Co. (LLY - Analyst Report) (dulaglutide) have GLP-1 candidates with once weekly dosing in late-stage development.

Glaxo is also looking to get the drug approved in the U.S. as well where a decision should be out by Apr 15, 2014.

Glaxo carries a Zacks Rank #4 (Sell). Some better-ranked stocks in the medical sector include Gilead Sciences Inc. (GILD - Analyst Report). The stock carries a Zacks Rank #1 (Strong Buy).

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