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Is Lilly & Amylin's Byetta "Betta"?

Published: Tuesday, 10 Jun 2008 | 1:28 PM ET

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By: Mike Huckman
Reporter

Shares of Amylin are ambling higher today after two destructive trading days.

First, last Friday, Novo Nordisk put out a press release saying preliminary data show its drug works better than Byetta. And then, yesterday an analyst downgraded the stock just ahead of the company's long anticipated release of long-term results on its once-a-week version of Byetta.

So, today the shoe's on the other foot for NVO [NVO Loading... () ]. You can hear what AMLN CEO Dan Bradbury thinks of Novo's Friday press release in the video clip below, from his "First on CNBC" interview on "Squawk on the Street" this morning.

The stocks have changed direction after Amylin [AMLN Loading... () ], Eli Lilly [LLY Loading... () ] and Alkermes [ALKS Loading... () ] announced that after one year patients on once-a-week Byetta saw a key measure of their blood sugar level drop two percentage points and their weight go down nearly 10 pounds.

FBR biotech analyst Jim Reddoch calls the results "unprecedented." David Kliff of the "Diabetic Investor" newsletter says, ""Quite frankly the results...aren't great they're astonishing." Rodman & Renshaw's Mike King in a research note to clients writes that they're "incredibly consistent results."

But Swiss drugmaker Roche also announced test results here on a similar once-a-week product. Wachovia analyst George Farmer says Roche's drug, which is moving into late-stage studies, "emerges as a strong competitor."

Combined with Novo's test results on a one-a-day version of the same class of drug Farmer says, "We see credible competition to AMLN's (Byetta) franchise beginning to emerge by 2010."

Wachovia, FBR and R&R make a market in AMLN. FBR would also like to bank the company.

In his wrap-up ADA meeting note to subscribers today Kliff concludes, "In this heavyweight fight Novo threw everything they had at Amylin who was able to withstand the assault. In the end investors should thank the people at Novo for creating a great entry point into Amylin shares. While a bit bloody after a tough few days, Amylin remains the most valuable property in the diabetes space."

Who knew bloody fights could break out at scientific meetings?

Actos Booth
To the right of Mike is HDL or "good" cholesterol. To his left in green is a triglyceride. The photo was taken at the booth for the diabetes drug Actos on the exhibit floor at the ADA meeting at Moscone Center in San Francisco.