Amylin Pharmaceuticals (NASDAQ:AMLN) is in much the same situation as Amgen (NASDAQ:AMGN) is in: relatively flat sales, but the potential for a nice boost from a Food and Drug Administration approval shortly.
But that's where the comparison ends. Amgen is profitable; Amylin hopes to be cash flow positive by the end of the year and doesn't expect to be profitable on a GAAP measure until the end of 2011. The bigger issue is that Amgen's new osteoporosis drug, Prolia, is really new. The lack of growth from Amgen's other drugs shouldn't affect Prolia's sales.
Amylin's potential blockbuster, on the other hand, is just a line extension of its already approved diabetes drug, Byetta. Don't get me wrong, it's a vast improvement. Thanks to technology from Alkermes (NASDAQ:ALKS), the new drug only has to be injected once a week instead of twice a day. But if you assume that many patients are going to switch from the twice-daily to the once-weekly formula, it sure would be nice to see Amylin and marketing partner Eli Lilly (NYSE:LLY) growing the base of patients while they wait for an approval. That just isn't happening: Byetta sales were up just 0.6% in the fourth quarter and down 1.6% for the year.
The lack of growth in the number of Byetta patients isn't the end of the world for Amylin; certainly the once-weekly version will be able to get some new patients who aren't currently on Byetta. The twice-daily version has had a hard time competing with oral medications like Merck's (NYSE:MRK) Januvia and Takeda's Actos since popping pills is a lot easier than injecting yourself. But with only one injection per week, patients should find the new version more tolerable. Considering that the once-weekly version beat Januvia, Actos, and sanofi-aventis' (NYSE:SNY) Lantus in head-to-head trials, doctors should like it too.
Still, a larger base to convert from would be nice. With the FDA scheduled to make its decision in March, Amylin has one more quarter to grow that base. The new approval of Novo Nordisk's (NYSE:NVO) competing drug, Victoza, isn't going to make it any easier, but that doesn't mean that investors should cut Amylin any slack.
