Amylin Pharmaceuticals, Inc. (AMLN) suffered a huge setback recently when the US Food and Drug Administration (FDA) issued a second complete response letter (CRL) for Bydureon, Amylin’s main pipeline candidate. Amylin and its partners, Eli Lilly and Company (LLY) and Alkermes, Inc. (ALKS), were looking to get Bydureon approved for the treatment of type II diabetes.
The latest CRL, which came a few days ahead of the FDA action date, was a complete surprise. At the time of issuing the first CRL, the FDA had not asked the companies to conduct additional studies. At that time, the FDA had only asked for additional information that was subsequently submitted by the companies.
However, in its latest CRL, the FDA has asked the companies to conduct a thorough QT study. We believe the FDA may have asked for this study based on the recent concerns regarding the cardiovascular safety profile of diabetes drugs.
The agency has also asked Amylin and its partners to submit data from the DURATION-5 study, which was conducted to compare the safety and efficacy of Bydureon versus Byetta.
Amylin said that the QT study will be conducted once the protocol is approved by the FDA.
Amylin’s Loss is Novo Nordisk’s Gain
Given the additional studies that need to be conducted with Bydureon, we believe Amylin and its partners will not be in a position to re-submit for approval before the end of 2011. The companies expect the re-submission to be treated as a Class II re-submission, which means a response should be out within 6 months.
Considering these timelines, Bydureon is not likely to hit the market before the second half of 2012. The significant delay in Bydureon’s approval is good news for Novo Nordisk (NVO), which received approval for its diabetes treatment, Victoza, earlier this year. Victoza is a once-daily injection like Bydureon and the timely approval of Bydureon would have posed a major competitive threat for Victoza.
Amylin Postpones Third Quarter Earnings Release Date
Amylin was slated to report third quarter results on Oct 20. However, the company announced its revenues and canceled its earnings release date. A new date will be issued once the company evaluates the impact of the Bydureon CRL.
Amylin provided unaudited net product sales for the third quarter. While Byetta sales declined 22.6% to $132.4 million, Symlin sales came in at $21.6 million. Both products have been performing below expectations over the last few quarters. Total net product sales came in at $154 million, down 20.2% from the year-ago period.
Our Take
The delay in the approval of Bydureon is a major jolt for Amylin and we expect the shares to be negatively impacted by the news. With currently marketed products, Byetta and Symlin, lagging expectations, Amylin had a lot riding on the timely approval of Bydureon.
With the company having to conduct additional studies with Bydureon, we expect R&D spend to increase. No revenues from Bydureon and additional expenses associated with the candidate are likely to result in the company slashing its guidance for 2010.
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