An estimated 347 million people worldwide -- more than the population of the United States -- currently suffer from diabetes. Currently, 25.8 million of those people live in America, accounting for 8.2% of the total population. According to the CDC, that alarming figure will rise to one in three Americans by 2050, due to poor health habits and a rapidly aging population.

However, four companies -- Novo Nordisk (NYSE: NVO), Eli Lilly (NYSE: LLY), MannKind (NASDAQ: MNKD), and Medtronic (NYSE: MDT) -- are changing how diabetes is treated, and could help diabetes patients enjoy a higher quality of life than ever before.

Novo and Lilly, the pioneers of insulin
To fully appreciate how far we've come in insulin development, we need to first take a trip back in time. Prior to 1921, diabetes was considered a death sentence -- the only effective treatment was to put patients on strict diets with limited carbohydrates, which could only increase survival by a few years.

In 1921, Frederick Banting, a surgeon, succeeded in extracting insulin from a dog's pancreas. Over the next few decades, companies like Eli Lilly and Novo Nordisk started removing insulin from pigs and cattle for commercial production -- a method that improved the lives of many patients, but also caused allergic reactions.

This led to Lilly's breakthrough approval of the first genetically engineered "human" insulin, Humulin, which was produced using E. coli bacteria in 1982.

For many years, human insulin was regarded as the standard of care for diabetes patients. However, Lilly and Novo further improved insulins in the 1990s by creating insulin analogs; modifying the amino acids within the insulin make them longer acting, faster acting, or both. This advance dramatically improved the versatility of insulin -- for example, a longer-acting insulin analog could reduce the number of necessary daily injections, while a faster-acting one would be ideal after meals.

In recent years, Novo Nordisk has gone a step beyond insulin with Victoza, a new drug known as a GLP-1 analog, which stimulates the pancreas to naturally produce more insulin. Since its European approval in 2009, and FDA approval in 2010, Victoza has become one of Novo's top-selling products, accounting for 14% of its revenue last quarter.

Victoza is the current market leader in GLP-1 drugs, with a 70% market share, but other competitors such as Bristol-Myers Squibb and AstraZeneca's Byetta/Bydureon, and Sanofi's Lyxumia, are gaining ground. Lilly also has a GLP-1 drug in phase 3 trials.

MannKind's inhalable insulin
Despite all of Novo and Lilly's advances, however, all of their treatments are injected. MannKind wants to change the status quo by bringing inhalable insulin to the market.

MannKind isn't the first company to dream of replacing needles with inhalers. In 2006, Pfizer (NYSE: PFE) launched the first inhalable insulin, Exubera, but it was discontinued only a year later, causing a $2.8 billion writedown for the company.

Exubera failed for three main reasons -- its inhalation device was bulky (the size of a can of tennis balls), it used a confusing system of nonlinear doses, and it cost $5 per day compared to $3 for traditional insulin. In addition, needles for insulin injections have become much smaller over the years, and many diabetes patients had already grown accustomed to self-injections.

Exubera's failure was so disastrous that other inhalable insulin products from Aradigm/Novo Nordisk and Alkermes/Eli Lilly were abandoned. Yet, MannKind is still convinced that its inhalable insulin product, Afrezza, will eventually be a game changer, although it has already been rejected twice by the FDA.

Afrezza appears to be a vastly superior product to Exubera, because its inhaler is much smaller (the size of an asthma inhaler), it uses linear doses, and it uses an insulin analog, compared to Exubera's human insulin. Since Afrezza uses an insulin analog, it has a much faster peak absorption time (12-14 minutes) than either injected human insulin (60-240 minutes), or Exubera (30-90 minutes ).

Last month, MannKind resubmitted its NDA (new drug application) for Afrezza to the FDA, stating that two phase 3 studies had shown positive results. Investors are definitely hoping that the third time's the charm for MannKind -- a volatile stock that has slid more than 20% during the past six months. If approved, Afrezza could generate annual peak sales of $2 billion, and possibly render injected insulin from Novo, Lilly, and Sanofi obsolete.

Medtronic creates the first wearable artificial pancreas
Last but not least, we should also take a look at Medtronic, the largest medical-device maker in the world. Medtronic has extended human lives by mechanical means ever since it created the world's first battery powered external pacemaker in 1957. Since then, Medtronic's pacemakers have helped patients with heart conditions live longer than ever.

Last month, the FDA approved the MiniMed 530, the first wearable artificial pancreas in the world for patients with type 1 diabetes. Type 1 diabetes patients cannot naturally produce any insulin, and must use continuous pin pricks and insulin injections throughout the day to carefully control their blood glucose levels.

The MiniMed 530 is a combination of a wearable glucose meter and an insulin pump. The pump injects insulin until the glucose meter detects that blood sugar levels have fallen below a defined threshold. This level of automation had never been seen before -- other similar products like Insulet's OnmiPod require patients to manually operate the pump.

Although it's not a perfectly closed loop system, the MiniMed 530 is a huge step forward in improving the daily lives of type 1 diabetes patients. Medtronic's device has attracted a lot of attention -- Johnson & Johnson and Dexcom are also working together on a competing artificial pancreas known as Animas.

The Foolish takeaway
It's amazing how much progress has been made in diabetes treatments during the last 92 years. From extracting insulin from dogs, companies have synthesized human insulin, drugs that stimulate the pancreas to produce insulin, and even wearable machines that can replace the pancreas altogether.

It will be exciting to see what incredible new ways these four companies, along with many others, can improve the lives of diabetes patients over the next few decades.

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Fool contributor Leo Sun has no position in any stocks mentioned. The Motley Fool owns shares of Medtronic. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.