It was a good start for Amylin Pharmaceuticals (NASDAQ:AMLN) on its goal of having positive operating cash flow by the end of next year, but I doubt it'll be enough to keep Carl Icahn and Eastbourne Capital from complaining. The company managed to halve its non-GAAP operating loss -- which "approximates" its operating cash flow "before working capital changes" -- from $44 million in the year-ago quarter to less than $20 million in the first quarter of this year.

Unfortunately, that decreased loss was almost entirely due to cutting costs. Sales were essentially flat year over year, as the company has had trouble boosting sales of its diabetes drug, Byetta, because it was linked to pancreatitis. In fact, prescriptions for Byetta were actually down from the previous quarter.

In order to get sales growing again, Amylin is combining its sales force with marketing partner Eli Lilly (NYSE:LLY). The increased focus may help a little, but Amylin is going to have a hard time growing sales by leaps and bounds until it gets the once-weekly version of Byetta approved.

With or without the pancreatitis issue, the currently available drug is unlikely to be a major seller because it has to be injected twice daily. With plenty of oral drugs available to diabetics, it's more reasonable to ask patients to inject themselves once a week with the new product, which was designed using Alkermes' (NASDAQ:ALKS) extended-release technology. The once-weekly formula also beat up on two oral drugs, Merck's (NYSE:MRK) Januvia and Takeda's Actos, in a head-to-head clinical trial, which should help with sales. If it can do the same with sanofi-aventis' (NYSE:SNY) Lantus in an ongoing trial, the once-weekly drug should sell extremely well at both ends of the diabetes progression.

Amylin is basically sitting in limbo for the next year or so until it hears back from the FDA. The only thing it can do now is try and get as many people onto Byetta as it can. The early adoption from those patients when the once-weekly product is available should drive additional patients to the once-weekly product.

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