Amylin Pharmaceuticals Inc. (AMLN)

[SeriousMoney]

Amylin's Byetta Has Long-Term Potential
Peter Kang, Forbes.com, 10.28.05, 8:55 AM ET

Morgan Stanley maintained an "overweight" rating on Amylin Pharmaceuticals (nasdaq: AMLN - news - people ) after the diabetes-focused drugmaker announced third-quarter results.

Amylin posted a loss of 65 cents per share on revenue of $25.9 million, compared with a consensus estimate for a loss of 57 cents per share on revenue of $30.7 million.

"Over the next 12 months, we see Amylin as range bound ($33 to $39), and would buy it at the low-end, but see no reason to chase it at the high end," said analyst Steven Harr, in a note to investors. "Byetta sales of $18 million were more or less in line with our $17 million estimate, but may not satisfy recently growing Street expectations."

The research analyst lifted the price target to $39 from $29, and said the next major catalyst for Amylin is Phase II data for the long-acting release (LAR) version of Byetta used in combination with a relatively new class of drugs known as peroxisome proliferator-activated receptors (PPARs). Harr expects "strongly positive results."

The extended release version of Byetta "has the potential to be one of the largest drugs in any biotech pipeline, and clarity on its development program (expected in the first quarter) has the potential to move the stock significantly," the Morgan Stanley analyst said.

The diabetes treatment, also known as exenatide LAR, is being developed with Eli Lilly (nyse: LLY - news - people ) and Alkermes (nasdaq: ALKS - news - people ).

http://www.forbes.com/markets/2005/10/28/amylin-diabetes-earnings-1028markets01.html?partner=yahooti...