Amylin Pharmaceuticals Inc. (AMLN)

[SeriousMoney]

Amylin: Byetta sales set for bumpy ride
By Staff Writer, 13th April 2006
Pharmaceutical Business Review

Given that physicians expect to increase their use of Amylin's diabetes drug Byetta over the next two years, the product is expected to generate US sales of $336.1 million in 2006 and $555 million in 2007. However, oral rivals look set to take market share from Byetta thereafter, before a once-weekly formulation of the drug, expected in 2009 or later, can help the franchise recover.

Based on favorable reports from surveyed physicians on Byetta's efficacy and comfort with its safety profile, physicians are expected to increasingly prescribe Byetta over the next two years. On average, they currently prescribe the drug to 34% of patients who fail oral therapies, and plan to increase this to 48% in two years' time. Byetta's US sales are therefore forecast to reach $336.1 million in 2006 and $555 million in 2007.

Although the treatment's price and its cumbersome twice-daily injection delivery method are significant barriers to uptake, Byetta's potential for weight loss acts as a key incentive for patients.

Nevertheless, competition from oral formulation rivals is set to increase from late 2006 onwards. Merck's Januvia and Novartis' Galvus, both DPP-IV inhibitors, are expected to launch in late 2006 and early 2007, respectively, and look set to be the first of several competitors to Byetta. Due to their oral formulation, 70% of surveyed physicians expect DPP-IV inhibitors to reduce Byetta usage, in spite of their questionable efficacy and a lack of weight loss benefit.

Furthermore, it is also possible that novel anti-obesity agents, specifically Sanofi-Aventis' Acomplia, will impact physicians' use of Byetta. Rather than competing directly, such agents may increase the competitive threat of other oral drugs, by eliminating the power of Byetta's weight loss advantage.

As a result of these threats, Byetta's US sales for 2008 are forecast to see a modest rise, to reach $580.4 million.

To combat this, Amylin, Eli Lilly and Alkermes are working to develop a long-acting release formulation of Byetta. Clinical trials are being conducted with a once-weekly formulation, and the feasibility of a once-monthly formulation is also being explored.

A once-weekly formulation, anticipated to launch in 2009 or later, would greatly help the franchise recover from its flat 2008 sales forecast. However, faced with up to two years of anticipated declining market share prior to its launch, the ramp-up in revenue may be slower than Wall Street expects.

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