Novo Nordisk shares are on the slide this morning after a US advisory panel expressed concerns about cancer risks linked to the Danish firm’s investigational diabetes drug liraglutide.

The Endocrinologic and Metabolic Drugs Advisory Committee of the US Food and Drug Administration voted 8-5 that there is sufficient clinical data for liraglutide, which will be marketed as Victoza, to rule out excess cardiovascular risk relative to competitors." However, the panellists were split (6-6, with one abstention) as to whether data on thyroid tumours seen in studies on rodents permit approvability.

Panel member Peter Savage of the National Institutes of Health was quoted as saying that "the animal data is worrisome, and I didn’t see sufficient human data to feel reassured”. He added that “I’m also not convinced that the benefit of adding this drug with the risk at this time outweighs the tradeoffs”.

However 12 panel members suggested that a small number of thyroid tumours found in humans in clinical studies should not prevent Victoza from being approved. The committee reviewed data from 40 studies involving more than 6,800 people with type 2 diabetes, of which more than 4,600 were treated with liraglutide.

The lack of unanimous support for Victoza is a blow for Novo. Liraglutide is a glucagon-like peptide-1 analogue, like Amylin/Eli Lilly’s blockbuster Byetta (exenatide). Novo has presented data which shows that liraglutide provides statistically significantly better blood glucose control than exenatide, and it requires one injection per day, instead of two. In a conference call this morning, Novo chief executive Lars Rebien Sorensen said the company is confident that the drug is safe but recognises the FDA panel's concerns, and will continue to work closely with the agency over the next months.

However it now seems that a launch of liraglutide in the USA by mid-2009, which Novo had been hoping for, looks a little ambitious. Most analysts believe that there is little chance of the FDA rejecting Victoza outright but if the drug’s label has to carry a cancer warning, this will clearly affect sales.

The agency is expected to give its final decision in the next couple of months but investors are concerned. At 11.17 this morning, Novo’s shares were down 11.8% to 247.50 Danish kroner.