San Diego-based Amylin Pharmaceuticals is suffering from an anxiety that many struggling biotechnology companies would envy.
There's fear that the manufacturer of the cartridge containing the company's diabetes drug, Byetta, won't be able to keep up with demand.
Because of the cartridge crunch, Amylin and its Byetta marketing partner, Eli Lilly and Co., are asking doctors to limit the number of new prescriptions for the type 2 diabetes treatment.
Company officials began making the request of top-prescribing doctors this week, said Jamaison Schuler, a spokesman for Indianapolis-based Lilly. In April, the companies stopped providing samples and vouchers for the drug.
There's not really a shortage of the drug, an Eli Lilly spokesman said, but the companies want to be sure that current patients can continue to renew their prescriptions.
The cartridges are made by a division of the U.K. company, Wockhardt. Schuler said the limitations are temporary.
Bloomington, Ind.-based Baxter Pharmaceutical Solutions is expected to begin producing the cartridges in the second half of this year, which should ease fears of a crunch, Schuler said.
The synthetic design of Byetta is derived from a protein found in the spit of the poisonous Gila monster lizard. Approved for market in April 2005 and launched for sale that June, Byetta mimics an insulin controlling hormone produced naturally in the body.
About 1 million prescriptions of the drug have been filled since then by about 200,000 patients, Schuler said.
The announcement sent shares of Amylin down $2.81, or 6.6 percent, to $42.81 at the close of trading yesterday. Shares continued to dip slightly in after-hours trading.
“I'd say the Byetta news is very nice and positive for the big picture,” said John McCamant, editor of the Medical Technology Stock Letter in Berkeley.
“Consider that we were at $17 (a share) a year and a half ago, and (other analysts) were saying diabetics were completely well served and there was no need for new medicines, and physicians were crying about patients having to use needles...and now they can't meet demand,” McCamant said.
The company also has made a series of positive announcements about Byetta in recent days.
Last weekend at the American Diabetes Association meeting in Washington, Amylin and Lilly showed that the results of a two-year study on diabetics using Byetta injections showed a sustained reduction in blood sugar level and an average weight loss of 10 pounds, versus a five pound average loss in people taking the drug for 30 weeks.
Patients receiving Byetta therapy also showed an improvement in the function of their insulin-producing beta cells.
The companies also announced that a study of patients taking a once-weekly dose of the drug were able to achieve recommended levels of blood sugar control, with an average improvement of about two percent compared to placebo.
The study was conducted with 45 type 2 diabetes patients unable to control their blood sugar with the drug metformin or a diet and exercise regimen.
Results of another study presented by the companies showed that even a small percentage of weight loss could lower health care costs among people with type 2 diabetes. The study, which included data from HMO claims databases, showed diabetics who experienced a 1 percent weight loss decreased their average health care costs by 3.6 percent over a year, or about $256.
“The benefit of controlling blood sugar levels and the associated weight reduction demonstrated by patients taking Byetta is significant since these are important clinical goals that many patients have difficulty achieving longer term,” said Dr. Robert Henry, lead investigators and Chair of the Veterans Medical Research Foundation Advisory Research Committee.
Left unchecked, the buzz created about Byetta at the diabetes conference cold cause an even further acceleration in the growth of its sales in coming weeks, Piper Jaffray & Co. analyst Thomas Wei wrote in a research note.
Based on management comments during the first-quarter 2006 earnings conference call, Wei said he estimated that Byetta demand would have to be in excess of $500 million on an annualized basis before there were a near-term supply issue.
The weekly data continue to show growth and currently annual projections are $436 million in sales, he wrote. Attempts to temporarily slow down Byetta prescriptions should not hurt the long-term trajectory of its sales, he said.
Deutsche Bank analyst Barbara Ryan wrote in a research note that she's concerned about Byetta's short-term growth prospects because of the cartridge shortage.
Amylin had some other good news at the diabetes conference.
Pre-clinical testing of Leptin, a compound it bought the rights to recently, given in combination with the company's hormone symlin, showed a sustained weight loss and a reduction in food intake in obese rats.
Although these are very early results, they are interesting because of Leptin's long history and repeated failure when used alone as a weight control therapy.
Leptin, a neurohormone produced by fatty tissue, was big news in the 1990s as a potential weight-loss wonder. It plays a role in regulating the body's energy intake and expenditure. Obese people have high levels of it and are believed to be resistant to its effects.
In May 1996, the biotech company Amgen began human clinical trials on leptin, but studies eventually showed it to be ineffective except at the highest dose levels. In March, Amylin bought the rights to leptin from Amgen.
Amylin's drug symlin, which is approved by the Food and Drug Administration to help people with type 1 diabetes, who are already taking insulin, to better control the harmful ups and downs in their blood sugar.
And Phase 2 trials in which people, without diabetes, used Symlin to lose weight show promise.
Add the leptin and long-acting-release Byetta data to the picture and you get a sense of a company “that's really coming along,” McCamant said.
“I think it has transitioned itself to be one of the leaders in the biotech space,” he said. “It's certainly become a world leader in diabetes innovation. What other company has brought two effective new diabetes treatments to market?”
The Associated Press contributed to this report.
Terri Somers: (619) 293-2028; terri.somers@uniontrib.com
