FDA asks Amylin for more details but no new trials

BOSTON (Reuters) - Amylin Pharmaceuticals Inc (AMLN.O) said U.S. health regulators did not immediately approve a once-weekly form of its diabetes drug Byetta but did not ask for lengthy new clinical trials -- a relief to investors who pushed the company's stock up over 13 percent.

In a letter to Amylin and partner Eli Lilly and Co (LLY.N), the U.S. Food and Drug Administration requested finalization of information to be included in the drug's label, and a risk evaluation and mitigation strategy, Amylin said on Monday.

"This development is positive in that it most likely removes the possibility of a lengthy delay beyond 2010," Cory Kasimov, an analyst at J.P. Morgan, said in a research report.

The agency also requested clarification of Amylin's manufacturing processes, but it did not make requests related to observations from a pre-approval inspection at an Ohio manufacturing plant.

U.S. regulators found shortcomings at the plant during an inspection in December, but Amylin said all of those observations have been addressed.

The new drug, with a proposed name of Bydureon, is a once-weekly version of Byetta, which is given twice daily by injection and which had sales last year of $797 million.

Byetta, whose chemical name is exenatide, is used to treat type II diabetes -- the more common form of the disease that is closely linked to obesity. Bydureon, known chemically as exenatide LAR, uses technology from Alkermes Inc (ALKS.O) to release the drug at a controlled rate.

Shares of Alkermes rose $1.54 or 12.6 percent to $13.75 in afternoon trading on Nasdaq.

In January, the FDA approved a similar drug -- Novo Nordisk A/S's (NOVOb.CO) Victoza. Both drugs belong to the GLP-1 class of drugs that stimulate insulin production to regulate blood sugar levels.

The FDA approval of Victoza, a once-daily injection, included a boxed warning for the risk of thyroid cancer.

The company declined on a conference call to give details of what it expects to see in the final label, but J.P. Morgan's Kasimov said he sees a low probability of a label that avoids a cancer risk warning.

"We still believe there's a relatively high probability of a Victoza-like label," he said. "Differentiation may occur on the breadth of the indicated target population."

Byetta has been associated with a risk of pancreatitis, a potentially fatal inflammation of the pancreas.

Amylin's shares rose $2.72 or 13.4 percent to $22.98 on Nasdaq. Shares of much larger partner Eli Lilly were off 9 cents or 0.3 percent at $35.84.

(Additional reporting by Esha Dey; Editing by Gerald E. McCormick and John Wallace)