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FDA OKs Once-a-Week Successor to Injectable Diabetes Drug

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WASHINGTON (AP) — Amylin Pharmaceuticals Inc. (Nasdaq:AMLN) has won approval from the U.S. Food and Drug Administration (FDA) for Bydureon, an injectable diabetes drug that will cost patients and their insurers 11% more than an older version of the drug, Byetta, but is more convenient.

Patients with type 2 diabetes can control their blood by taking Bydureon just once a week, according to Amylin, San Diego. Users of Byetta, which is 7 years old, must inject that drug twice a day.

The monthly cost of a series of injections could be $323 for Bydureon, compared with $291 for Byetta.

Amylin has faced delays in getting FDA approval for Bydureon, and the diabetes drug market now includes a treatement in the same class that has shown superior results.

Bydureon is part of the GLP-1 class of drugs, which work by increasing the body’s insulin production.

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People with type 2 diabetes are unable to properly break down carbohydrates, either because their bodies do not produce enough insulin or because they’ve become resistant to the hormone, which controls blood sugar levels.

Diabetes affects more than 25 million people in the U.S., or roughly 8% of the population.

Amylin executives say the convenience of the weekly Bydureon regimen should give it a competitive advantage, but Amylin reported last year that, on average, Bydureon reduced blood sugar levels in diabetics less than Victoza, a competing drug that uses a different mechanism of action.

Amylin developed Bydureon together with Eli Lilly and Company, Indianapolis (NYSE: LLY) which also helped co-market Byetta. The companies obtained the formulation technology for the drug, which gradually releases the drug over the course of a week, from Alkermes P.L.C., Dublin, Ireland (Nasdaq: ALKS).
In 2010, the FDA asked Amylin to conduct a new study of the drug’s effects on the heart’s rhythm. News of the costly delay cut the price of Amilyn’s shares in half and contributed to the eventual breakup of the Amylin partnership with Eli Lilly. The companies ended their collaboration in November 2011. Amylin paid $250 million and agreed to take over full responsibility for both Byetta and Bydureon by the end of 2013.

Analysts generally expect Bydureon to generate $940 million in sales annually by 2016. Deutsche Bank analyst Robyn Karnauskas says the drug must post $1.2 billion annually to turn a profit.

Karnauskas points out in a note to investors that Amylin currently has $2 billion in long-term debt and only $210 million in cash. She says Bydureon’s approval should give Amylin greater flexibility in efforts to refinance its debt.

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