Today's Barron's:
Payday Deferred
Amylin extends testing period for diabetes drug
Payday will come at least a year later for Amylin
Pharmaceuticals, the biotech firm whose novel diabetes
drug was the subject of a recent Barron's story ("Sweet
Prospects," Nov. 10). The San Diego firm has decided
to extend the duration of ongoing tests of its drug,
pramlintide.
Longer studies with additional patients should more
clearly show if the drug usefully lowers the excessive
blood-sugar levels of diabetics. But instead of a late
1998 filing for Food & Drug Administration approval,
Amylin now plans on filing some time in the year 2000.
"It was not an easy decision," says Amylin Chairman
Ted Greene. "But we did not want to bet the farm on an
insufficient database." Solid data became a priority after
the company reported two studies in August that
showed pramlintide produced only a slight drop in the
blood sugar of patients who used the drug along with
insulin for a year.
Those glum results halved Amylin's stock price to
around 8 recently. But pramlintide's poor showing may
have resulted from the design of those studies, not from
shortcomings in the drug. The tests now under way will
better control patients" doses of insulin to ensure that
any changes in blood sugar come from the Amylin
product and not from uneven insulin dosing.
Studying a diabetes drug is a long-term undertaking
because, if approved, the medicine would be taken by
patients for the rest of their lives. What's more, doctors
want to make sure that the pharmaceutical has a steady
impact on diabetes by cutting the blood level of a
particular sugar-tainted hemoglobin. This hemoglobin
measure goes down only if blood sugar has stayed low
for a complete three-month course of treatment. So the
Food and Drug Administration will want to monitor
pramlintide's performance over several such three-month
courses, says Richard Krawiec, head of corporate
communications at Amylin.
If the little company's drug proves effective, then
pramlintide could become a billion-dollar product, used
by many of the seven million patients who take insulin in
North America and Europe. Amylin would split
operating profits with its worldwide partner on the drug,
Johnson & Johnson, which remains committed to
pramlintide despite the disappointing August medical
data, says Amylin Chairman Greene.
Pramlintide is based on a recently discovered hormone
that helps insulin keep blood sugar in line. But the
hormone works in a different way, and Amylin hopes
that patients who take pramlintide can get by on less
insulin. Insulin powerfully cuts high blood sugar, but
many diabetics refuse to take an effective dose because
insulin can also cause blackouts and weight gain.
Greene argues that some
of the disappointment
with pramlintide results
from comparing its
moderate effect on
blood sugar with insulin's
potent effect.
"Pramlintide's not like
insulin, and that's good,"
he says. "Insulin causes
weight gain. Pramlintide
causes weight loss."
Pramlintide's potential benefit on weight control is of
great interest to adult diabetics. In many of those
patients, the diabetes is a result of the patients" obesity.
Amylin announced the extension of its diabetes studies
while reporting its financial results for the nine months
ended September. As expected for a developing biotech
firm, Amylin ran a loss of $33 million, or $1.03 a share,
for the nine-month period, compared with a $22 million
loss, or $0.78 a share, for the like period in "96.
The firm had just under $50 million in working capital at
the end of September, but with J&J's financial backing,
Greene doesn't expect to run out of money before
pramlintide starts to sell.
Although the biotech stock has now slipped below 7, an
added 12-18-month wait will prove worthwhile for
investors, claims Greene, if it boosts chances that
pramlintide's development will pay off. After all, most
drug candidates flop.
"In the drug business, development risk has a much
greater impact on value than does time," he says. "If you
have to trade more time for less development risk, it's a
good trade."
-Bill Alpert |
