Amylin Pharmaceuticals (Nasdaq: AMLN) is trying to turn lemons into lemonade. I hope management went light on the sugar; it sells diabetes drugs, after all.

Here's the bad news: Sales of Byetta, which it sells with Eli Lilly (NYSE: LLY), were down 8% compared to the fourth quarter. That's partly because Novo Nordisk (NYSE: NVO) launched its competing GLP-1 drug, Victoza, in the U.S. in February. Victoza is injected half as often as twice-daily Byetta, and the newcomer beat Byetta in a head-to-head trial.

And here's the sweetened-up version: The growth of Victoza is greater than the losses sustained by Byetta, so the class of drugs is growing. In fact, Amylin estimates that new prescriptions for GLP-1 drugs are up 60%! The early adoption of Victoza indicates that doctors are willing to try new diabetes drugs. Since Amylin has one in the works, it follows that Byetta's slump isn't all that bad -- according to management, at least.

Byetta's follow-up, Bydureon, received a complete response letter from the Food and Drug Administration last month, and the company plans to respond to the agency's questions this week. Depending on how substantial the response is, the FDA will give itself either 60 days or six months to make a decision.

Bydureon, created using Alkermes' (Nasdaq: ALKS) extended-release technology, has the potential to grow the GLP-1 market considerably, because it only has to be injected once a week. Diabetics who have shunned daily shots in favor of oral medications developed by GlaxoSmithKline (NYSE: GSK), Bristol-Myers Squibb (NYSE: BMY), or Merck (NYSE: MRK) may be willing to tolerate a single needle prick per week.

It's surprising to me that doctors didn't just stick with Byetta, because Bydureon has the same active ingredient. It's possible that doctors really are willing to switch patients willy-nilly to the newest toy in their medicine bag, but Amylin could also be underestimating the power of head-to-head trial data. Amylin won't have completed results for a trial comparing Bydureon to Victoza until next year. Until that data is in, it might not be as easy to get the patients back as Amylin is making it out to be.

Nick Kapur looks for stocks that he doesn't have to sell. Ever.

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