Pharmas Market with Mike Huckman

Out of the Fridge


Could room-temperature Byetta heat up sales? Amylin Pharmaceuticals and Eli Lilly announced that the FDA says their diabetes drug Byetta (pronounced buy-ate-uh) doesn't have to be kept in the fridge anymore. Byetta is the twice-a-day stick-pen injectable drug that helps people lower their blood sugar and lose weight. It's made with a synthetic version of gila-monster saliva. Some people who take it have nausea and vomit, but the companies say eventually it passes. Up until now Byetta had to be shipped to patients in little coolers and refrigerated until it's all used up. The companies say the drug still has to be cooled until "first use", but after that it can be stored in a room between 36-degrees and 77-degrees Fahrenheit.

In a research note to clients this morning FBR biotech analyst Jim Reddoch writes that a recent FBR survey showed 65% of doctors believed the refrigeration requirement was "an issue". And of those docs 70% said they'd prescribe more Byetta if or when the stuff could be kept out of the fridge. Reddoch believes this is one of "multiple reasons to expect a (Byetta) sales ramp-up in 2007." FBR makes a market in AMLN.

Lilly, Amylin and Alkermes are working together on a once-a-week version or so-called long-acting-release version of Byetta. If it works, many analysts believe it will be a multi-billion-dollar seller. Reddoch says phase 3 or late-stage, large clinical trial data on Byetta LAR are expected in the fall. Every now and then speculation surfaces that Amylin is a potential takeout target by Lilly (the CEOs of both companies have repeatedly denied having any such plans) or another company. That could change, of course, depending on the outcome of the Byetta LAR tests.

Tale of Two Industries:
One of the reasons Amylin could be acquired is big pharma's need--some say desperate need--to fill its pipelines and portfolios with products. Many of the major drug companies are laying off thousands of employees and closing or selling manufacturing plants and research and development facilities. Standing in stark contrast to what's happening in big pharma is biotech, in general, and Genentech , to be specific. Last Friday I was at the biotech giant's South San Francisco campus shooting a story and was astounded by the amount of construction going on there. The company is adding nearly 800,000 square feet of office and lab space along with approximately 2,500 parking spaces. 11 buildings are going up as part of the two-phase, $400 million project which should be finished by the end of next year. Genentech needs the space to accommodate the 1,200 people it plans to hire this year and the 1,500 employees, on average, it has brought on board in each of the past few years. Look for the story on CNBC in the not-too-distant future.

Questions?  Comments?