AMLN Amylin Pharmaceuticals, Inc. (MM)

It proved to be third time lucky for Amylin Pharmaceuticals, Inc. (AMLN) and Alkermes plc (ALKS) with the companies finally gaining US Food and Drug Administration (FDA) approval for their once-weekly type II diabetes treatment, Bydureon (exenatide extended-release for injectable suspension).

Bydureon, a glucagon-like peptide-1 (GLP-1) receptor agonist, gained approval as an adjunct to diet and exercise to improve glycemic control in adults with type II diabetes. This means that Bydureon can be used as a monotherapy, as well as in combination with commonly prescribed oral diabetes therapies.

Approval was granted with a Risk Evaluation and Mitigation Strategy (REMS) and post-marketing requirements. The REMS will keep healthcare professionals informed about the risk of acute pancreatitis and the potential risk of thyroid C-cell tumors associated with the use of Bydureon, and ensure that the benefits of Bydureon outweigh these potential risks.

Bydureon US Launch Slated for Feb 2012

Amylin is all set for the US launch of Bydureon in Feb 2012. The company intends to have two commercial units - one focused on exenatide and the other on specialty and orphan diseases.

While the exenatide team will consist of 650 diabetes sales specialists, the specialty and orphan disease team will initially focus on promoting Symlin. However, we note that once launched, Bydureon will face intense competition from Novo Nordisk’s (NVO) Victoza which already has a significant head-start in the GLP-1 market.

Amylin is looking to expand the exenatide franchise further and intends to commence a phase III study with a once-weekly suspension formulation of exenatide in mid 2012. A phase III program for the monthly suspension formulation of exenatide is scheduled to commence in 2013. Meanwhile, Amylin intends to file for approval of Bydureon Pen in 2012 with a potential launch later this year/early next year.

Amylin is looking to further strengthen its exenatide franchise by focusing on driving Byetta (exenatide) sales. The company, which terminated its exenatide agreement with Eli Lilly and Company (LLY) in November 2011, is currently looking for an ex-US partner. Partnering exenatide should maximize the value of the product.

Our Take

Bydureon’s approval comes as a major relief for Amylin. The US regulatory path for Bydureon had not been smooth with the candidate having received two complete response letters (CRLs) from the FDA earlier. We expect both Amylin and Alkermes shares to react positively to the long-awaited approval. Encouraging data and a convenient dosing regimen (once-weekly dosing) could very well help Bydureon gain share. We believe Bydureon peak sales could exceed a billion dollars.

 
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