Amylin Pharmaceuticals' (NASDAQ:AMLN) stock has been on a roller coaster ride the past few days. The stock fell 18% between Thursday and Monday as investors fretted about positive data from competitor Novo Nordisk (NYSE:NVO) and then made a 3.3% rebound yesterday as investors liked what they saw in its own presentation at the American Diabetes Association meeting.
Personally, I think investors have over-reacted in both instances. The bad news wasn't nearly that bad and the good news wasn't anything to jump up and down about.
Sure, Novo Nordisk's diabetes treatment, liraglutide, bested Amylin's Byetta in a head-to-head phase 3 trial. Normally, that would be reason to run from a stock. Additional reasons include the safety profile of liraglutide looking just as good, if not better, and it only has to be injected once a day versus Byetta's twice-daily requirement. Therefore, it's pretty clear that when liraglutide hits the market next year -- assuming it's approved by the FDA -- it will be able to take a sizable chunk of the diabetes market.
But Amylin and marketing partner Eli Lilly (NYSE:LLY) are working on -- surprise, surprise! -- an extended-release version of Byetta. Developed using Alkermes' (NASDAQ:ALKS) microsphere technology, it will be injected only once a week. Byetta's delivery method has always been one of the factors limiting its success, as well as the reason it hasn't sold as well as oral medications like Merck's (NYSE:MRK) Januvia. The once-weekly version, which Amylin expects to file a marketing application for by June of next year, could change all that.
The new data on once-weekly Byetta is just an extension of the trial data reported last year. The patients taking the drug for an additional 22 weeks still kept their A1C levels -- a measure of long-term blood-glucose levels -- in check. Patients that switched from the twice-daily version to the once-weekly version saw their A1C levels improve, but that's not a big surprise because the once-weekly version beat its older brother in the previously released data through 30 weeks. Like I said, nothing to jump up and down about.
For those of you keeping score at home, we've got liraglutide taking market share next year and then Amylin grabbing it back a year later. Clearly Amylin's future -- and its stock price -- should be pegged to data from once-weekly Byetta, but I didn't see anything from this weekend that should get investors too excited.
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