AMLN Is Waiting For A Decision On Byetta

CNBC's pharmaceuticals reporter Mike Huckman spoke on the Fast Money show about once-a-week diabetes drug called Byetta, that is waiting for FDA approval. The decision will be made on Friday, and Amylin Pharmaceuticals, Inc. (NASDAQ: AMLN), Eli Lilly & Co. (NYSE: LLY) and Alkermes, Inc. (NASDAQ: ALKS) are the companies that are involved in producing the drug. Alkermes (ALKS) provides the technology that keeps the drug a week longer in the system and it will receive 7% of sales as a royalty, while Amylin (AMLN) and Eli Lilly (LLY) will split the rest.

Byetta is first once a week drug for diabetes. The patient injects the drug once a week in the belly, and the drug lowers not only the blood sugar of the patient, but it lowers his or her weight as well.

JPMorgan projected that the sales for this drug could reach $374M in 2011, $817M in 2012 and $1100M in 2013, if the drug gets approved.

BMO Capital Markets biotech analyst Jason Zhang thinks that FDA will not approve Byetta. He downgraded AMLN to sell with a price target of $12. Biotech analyst Thomas Wei at Jefferies thinks that there is a higher chance of approval for Byetta then the last time he evaluated this drug. He added that he sees a risk-reward relationship on AMLN as favorable.

Amylin (AMLN) gained 1.77% today and closed at $20.18, Eli Lilly (LLY) fell 0.46%, while ALKS added 2.05%.