Fewer Needle Pricks for the Europeans

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"Potential heart problems? We don't see no stinking potential heart problems" -- a paraphrase of the Committee for Medicinal Products for Human Use of the European Medicines Agency.

The committee issued a positive opinion today recommending approval of Bydureon, the once-weekly diabetes drug from Amylin Pharmaceuticals (Nasdaq: AMLN  ) , Alkermes (Nasdaq: ALKS  ) , and Eli Lilly (NYSE: LLY  ) . The companies just need a rubber stamp from the European Commission, and they'll be able to start negotiating reimbursement for the drug in Europe.

The Food and Drug Administration wasn't so kind. The agency is requiring the companies to run a thorough QT study to measure the effect of the drug on heart rhythms.

This isn't the first time the EMA and FDA haven't seen eye to eye, and it certainly won't be the last. While the data that the agencies see is usually the same, the risk-benefit analysis is basically a matter of opinion. In the most extreme case, InterMune's (Nasdaq: ITMN  ) idiopathic pulmonary fibrosis treatment, Esbriet, only passed one of the two phase 3 clinical trials run by the company. That was good enough for the Europeans but not for the FDA.

Bydureon is extremely important to Amylin. Its twice-daily Byetta is getting beat up in the market by Novo Nordisk's (NYSE: NVO  ) once-daily Victoza. In the battle of needle pricks, the once-weekly formulation is the only hope of recapturing those patients.

Investors in Alkermes, which contributed the extended-release technology to allow for once-weekly dosing, are eagerly awaiting the royalties from sales of Bydureon. For larger Eli Lilly, the European approval isn't as big of a deal, but every little bit helps when you're facing a patent cliff.

Keep in mind that the results of the thorough QT study, due to be completed later this year, remain a gating event for both the U.S. and Europe. If the drug were to show a hint of heart issues, the European Commission could pull the marketing approval for Bydureon.

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Fool contributor Brian Orelli, Ph.D., doesn't own shares of any company mentioned in this article. The Motley Fool has a disclosure policy.

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  • Report this Comment On April 15, 2011, at 8:29 PM, bronx wrote:

    Maybe Europe doesn't have the same conflict of interest that may exist at the FDA, because of its Commissioner Dr. Magaret Hamburg.

    Dr. Margaret Hamburg is the FDA Commissoner and she is married to Peter Brown who runs a hedge fund called Renaissance Technologies. So you may ask the question so what.

    Well one of the top holdings in the Renaissance Technologies Fund is Novo Nordisk, who happens to be a major competitor of Amylin Pharmaceutical. Novo's diabetes GLP-1 drug Victoza, competes directly with Amylin's diabetes drug Byetta and will also one day have to compete with Amylin's Once a Week diabetes drug candidate Bydureon when approved.

    You then have Peter Brown's annual salary and compensation as head of Renaissance, which is directly tied to the performance of the Renaissance Fund including Novo Nordisk.

    On October 20, 2010 the FDA under Commissioner Dr. Margaret Hamburg surprisingly decided to delay the approval of Bydureon for the second time in one year, when they issued a 2nd CRL notice to Amylin. The action taken by the FDA on October 20, 2010 meant Bydureon's approval in the United States was going to be delayed for at least another 2 years, which handed Novo Nordisk Victoza drug a huge advantage in the Type II marketplace. The reasons given for issuing a second CRL Notice in particular the TQT Study made no sense and was not supported by science or documented safety results.

    The action taken by the FDA on October 20, 2010, resulted in Amylin's stock price losing almost 50% of its value in one day and it allowed Novo Nordisk to enjoy about a 30% rise in its stock price in the 4Q 2010. Obviously the 30% rise in Novo Nordisk stock price was a big win for the Renaissance Fund performance in the 4Q 2010 and Peter Brown.

    I believe Dr. Margaret Hamburg's position as FDA Commissioner presents a possible conflict of interest between her job as regulator of bio-pharmaceutical drugs and her and her husbands financial interests as a head of Renaissance Technologies hedge fund.

    There is no proof that anything wrong or unethical happened on October 20, 2010, but the perception still doesn't look good and maybe the matter should be investigated for the sake of public confidance in Wall Street and the FDA.

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