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Amylin Plans Big Push for Its New Diabetes Drug

Posted on: Monday, 20 June 2005, 03:00 CDT

Amylin Pharmaceuticals Inc.'s newly approved diabetes drug, Byetta, won't be making its way into doctors' offices until June, but patients are already asking about it, said a local endocrinologist.

San Diego-based Amylin has already deployed its newly trained sales force of 325 people to call on some 60,000 physicians nationwide who wrote 70 percent of prescriptions for diabetes drugs.

By June 1, Ginger Graham, Amylin's president and chief executive officer, hopes to train an additional 25 to 50 sales representatives to push the drug. Some analysts contend that Byetta has the potential to reach blockbuster status.

Amylin and its co-marketing partner, Eli Lilly & Co., announced late last month that the Food and Drug Administration approved Byetta, known generically as exenatide, for use in combination with two oral drugs in Type 2 diabetics who are not yet dependent on insulin.

Byetta's sanction follows another FDA approval in March for Amylin's first drug, Symlin, also for diabetes, but for patients who are dependent on insulin.

The first shipments of Symlin made their way into pharmacies last week, Graham told analysts during a May 4 conference call, discussing first-quarter earnings and the company's outlook.

"Interest is high and we know that prescriptions are being written and filled," Graham told analysts about Symlin's launch.

But the real interest lies in Byetta.

"This is a totally new angle on diabetic therapy," said Dr. Georges Argoud, an endocrinologist working in private offices in Chula Vista and Encinitas, about Byetta.

"Patients with diabetes are now very well educated. As soon as the initial reports became available, I've been asked when it's available."

Analysts estimated Symlin's market size to be $300 million significantly smaller than Byetta's expected sales, which some say has the potential to become a $1 billion blockbuster.

Weighty Issues

A first in a new class of drugs, Byetta has shown in clinical trials that it can help patients control their blood sugar while losing weight.

One major drawback of existing diabetes drugs is that they often cause patients to gain weight.

"No medication has the dual benefit of lowering blood sugar and also

being associated with weight loss, it' it's a unique characteristic of this

medication," said Argoud, who is familiar with exenatide, Byetta's

generic name.

As medical director for the inpatient diabetes program at the Sharp Chula Vista Medical Center, Argoud ran a small clinical trial in 2003, testing patients on exenatide in combination with the oral drug sulfonylurea.

The study found that half the patients taking Byetta suffered nausea, at least initially, he said. Still, most patients stayed on the drug because they felt the improved blood sugar control and weight loss offset the drawback, he said.

Graham- drove home exactly that point during the May 4 conference call. When an analyst asked about the biggest hurdles in trying to convince doctors to prescribe Byetta, Graham said educating doctors on possible side effects of nausea and low blood sugar will be key.

But Amylin's newly trained 325-person sales staff will also emphasize the drug's major benefits, she said.

Mark Foletta, Amylin's chief financial officer, told analysts it costs about $60 million, or $200,000 per person, to train a 300- person sales force.

Holding Off On Projections

However, the Amylin executives declined to project revenues for the sale of either drug.

"We haven't made any statements," Graham said. "Our goal is to get experience, educate the marketplace, get their feedback."

One of the major hurdles remaining is to get reimbursement from health insurers, especially for Byetta.

Graham said Byetta is easy to use. Patients inject themselves with a plastic pen twice a day, once before breakfast and again before dinner. But at a wholesale price of $147 a month for the low dose and $172.50 for the high dose, Argoud said Byetta is affordable for affluent patients but out of reach for most of his patients if they have to pay out of pocket.

Graham said Amylin contacted 180 health plans representing more than 90 percent of insured Americans in an effort to cover Byetta.

But it's a time-consuming process, she said.

Argoud agreed: "Typically, insurance companies are slow to approve coverage for new medications."

Insurance giant Blue Cross of California already said it would cover the costs for Byetta, according to Kellie Bernell, a Blue Cross spokeswoman.

Argoud says other insurance companies may follow suit quickly, because of Byetta's unique benefits.

Affecting Millions

Diabetes affects 18 million Americans, the vast majority the Type 2 form. Graham said about 6 million of them either take sulfonylureas, often the first course of treatment, or metformin, sold as Glucophage by Bristol-Myers Squibb, another old class of oral drugs.

Sixty percent of patients on combination drugs change their regimen three times or more in 12 months because they can't achieve adequate glucose control, she added.

Traditional insulin shots can cause blood sugars to drop dangerously low.

Byetta is the first "incretin mimetic," meaning it mimics the effects of a hormone called GLP-1 that is secreted by the stomach after a person eats.

The big advantage of the drug is that it stimulates insulin production and lowers blood sugar only when the body needs it.

Argoud said Byetta has also shown in animals that it can preserve or even increase the function of beta cells to produce insulin.

"One of the main problems with Type 2 patients is that beta cells get weaker during the course of diabetes," Argoud said.

Few medications today can preserve the cells and those that do often have the drawback of causing weight gain, he said.

Graham said the key effect of preserving beta cells led the FDA to leave the door open for Byetta to be used as a stand-alone drug pending submission of further data.

Such status, and if approved for wider use, means Byetta would likely post even higher sales.

Argoud remained skeptical.

"I think it would be an attractive medication to consider as a monotherapy, but we would (likely) have more resistance from patients to start an injectable medication when there are oral drugs available with similar benefits," he predicted.

Under Graham's plan, Amylin is poised to complete another Phase 11 study testing a long-acting release version of Byetta by year- end or early 2006.

Another Phase II study seeks to evaluate pramlintide, the same compound as Symlin, for treating obesity, but in non-diabetics.

A third study tests a GLP-1 compound for treating congestive heart failure, she said.

"The company has over $400 million in the bank," Graham said enough cash to launch two drugs and fund three Phase II trials as well as smaller programs.

On May 4, Amylin also announced its first-quarter earnings: For the quarter ended March 31, Amylin had an increased net loss of $43.6 million, or 43 cents a share, compared with a net loss of $37.3 million, or 40 cents a share, for the same period a year ago.

The conference call had little effect on the firm's stock price.

On May 4, Amylin, traded as AMLN on the Nasdaq, rose 2 cents to close at $16.

That's down from the firm's closing price of $17 on April 30, the day Amylin announced Byetta's FDA approval.

Graham remained optimistic.

"(The year) 2005 is set up to be one, if not the biggest" year in the history of the company, she predicted.

During its 18-year history, Amylin has weathered many biotech industry storms, from losing its first major drug development partner and running dangerously low on cash to layoffs. This year, it appears, Amylin's 900 employees will be plenty busy.

Copyright San Diego Business Journal May 09, 2005

Source: San Diego Business Journal

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