Icahn Ups Stake In Amylin

Icahn Ups Stake In Amylin

This morning we learned that Carl Icahn increased his stake in Amylin (NASDAQ:AMLN) and now owns almost 10% of the company. According to SEC filings Icahn now owns 9.43% of Amylin. Since January 30 Icahn has purchased over 845,000 shares. Not surprisingly shares of Amylin have risen nearly 15% as Icahn continues to accumulate shares.

As Diabetic Investor noted in our special issue on the Amylin situation published earlier this week, when this is all said and done Amylin will be acquired. In between now and then Icahn and Eastbourne will get the board sets they need to effectively control the company allowing them to put the company up for sale.  It will be interesting to see if the Icahn/Eastbourne team will be joined by other Amylin shareholders and just how quickly a sale can be completed when they gain control. 

These moves by Icahn should also send a signal to anyone who is concerned over the long term viability of Amylin’s GLP-1 franchise. While it is still possible that the FDA could take drastic, albeit unwarranted, against Byetta with the upcoming label change this scenario is looking less and less likely. It also appears that the FDA panel meeting for liraglutide will be a pivotal event for the entire class of GLP-1 drugs. Yesterday Roche, who also has a long-acting GLP-1 in phase three trials, noted their trial design may change based on what comes out of this meeting. Although they did not indicate they would halt development it’s clear they don’t want be in the situation Novo Nordisk (NYSE:NVO) found themselves when they brought Levemir to market.

Back then Novo was the difficult position of going against Lantus from Sanofi-Aventis (NYSE:SNY). Already well established in the market, Lantus has become the world’s number one selling insulin. While there was really nothing wrong with Levemir most physicians saw little reason to change patients already on Lantus, a proven product.

This scenario could repeat itself if Novo decides to position liraglutide as replacement for Byetta. A task made even more difficult should there be any delay in liraglutide getting approved by the FDA. Even with no delay things are setting up so that the earliest liraglutide will come to market is the end of the second quarter about the same time Amylin will be submitting Byetta LAR to the FDA.  Besides selling against Byetta, Novo will face the daunting task of selling against Byetta LAR.

Based on what Diabetic Investor is hearing from the field, physicians have already made up their minds choosing to wait for Byetta LAR rather than switch patients from Byetta to Liraglutide then switch them again to Byetta LAR. When it comes to new patients not previously using Byetta, physicians have indicated that although liraglutide is once daily dosing compared to twice daily for Byetta, they would choose Byetta as it’s a known commodity. It will also be easier to sell Byetta to the patient as they can tell them that a once-weekly dosing is right around the corner. As Diabetic Investor has been saying all along once-weekly dosing trumps once-daily dosing. Something Amylin also knows which is why they are doing everything in their power to get LAR to the FDA.

The bottom line here is the table is set for Amylin shareholders to reap some substantial profits. The shareholder battle only adds fuel to the fire.