What Next- The Bydureon Fallout

What Next- The Bydureon Fallout

As expected shares of Amylin (NASDAQ:AMLN) and Alkermes (NASDAQ:ALKS) are getting pounded relentlessly today due to the FDA’s ridiculous decision not to approve Bydureon, asking the company to perform even more studies which will likely delay the launch of the drug to mid-2012. The simple fact is Amylin, Alkermes and Lilly (NYSE:LLY) got screwed by the FDA, not to mention the millions of patients who are being denied an excellent therapy option.

Try and imagine that your football team is winning their game with two minutes to go and all of a sudden the NFL decides to change the rules of the game while the game is being played. For the past 58 minutes your team has been playing by one set of rules and now with no warning the rules of the game change. This is exactly what the FDA did to Bydureon.

Needless to say Diabetic Investor is incensed over this decision as are many respected diabetes researchers interviewed by Diabetic Investor. We have yet to find any experienced respected researcher who understands the FDA’s decision.

But the fallout from this bizarre decision is not limited to Amylin, Lilly and Alkermes. Think of the message the FDA has just sent to every company who has a type 2 diabetes drug under development. How can they trust anything they are told from the FDA, who basically blindsided Amylin as this QT issue was never mentioned as an issue that would impact approvability of Bydureon.

Think also of the message this sends to the many physicians who are anxiously awaiting the arrival of Bydureon. Physicians who are seeing their options for helping patients with poorly controlled diabetes diminish. At a time when we need more and better therapy options, the FDA is taking away options. Additionally, while Diabetic Investor does not believe there are any serious issues with Bydureon, the FDA’s action has placed a seed of doubt in the minds of physicians and as made the job of Amylin, Alkermes and Lilly even more difficult.

And once again the most adversely impacted group is the millions of patients who would benefit from Bydureon. The message sent by the FDA to patients is simple, when it comes to helping you better control your diabetes don’t look to us for any help. Or put more simply, we could care less that you don’t have the therapy options necessary to fight diabetes.

From a business perspective there are some clear winners here and three quickly come to mind. Merck (NYSE:MRK) must feel like they just won the lottery as Januvia continues its lucky streak. Sanofi-Aventis (NYSE:SNY) can breathe a sigh of relief as they now have more time to build their insulin franchise. Novo Nordisk (NYSE:NVO) is also jumping for joy as this decision gives them time to build their Victoza franchise as well as their insulin franchise.

It should also be noted that Amylin, Alkermes and Lilly are not the only losers here. Any company with a late stage type 2 diabetes drug is now facing an even longer, more expensive path to approval. Frankly these companies have no idea what the FDA will do next and must be scared to death over what the FDA is capable of doing. They can no longer trust anything they are told by the agency and must be dumbfounded over how the agency has forgotten that decisions are supposed to be made using science.

Frankly these companies stand a better chance of making money by taking the money they are spending on drug development and going to Vegas and playing roulette. At least the folks running the casinos in Vegas have a consistent set of rules and don’t change the rules of the game while the little white ball is spinning around the roulette wheel.

The reality here is the FDA has set back type 2 diabetes drug development for years to come. They remain oblivious to the real world impact of their decisions. Rather than follow the science and listen to experienced experts the agency is running scared making decisions based on fear of being called in front of Congress. As Edmund Burke wrote; “No passion so effectively robs the mind of all its powers of acting and reasoning as fear.”

Diabetic Investor can see the day coming when years from today Congress holds another set of hearings, only this time it won’t be about a drug that has failed but why diabetes is costing our nation billions of dollars.  They will pound away at the FDA asking them why they haven’t done more to prevent the diabetes epidemic from becoming not just healthcare disaster but an economic nightmare. They will ask why patients don’t have more and better drugs to fight diabetes.

It would be poetic justice if sitting at the table with the FDA are Dr. Nissen and his minions. Perhaps then these publicity seeking zealots will feel the other side of public attention and be racked over the coals. Perhaps they can then explain how the voodoo science, which they call meta-analysis, contributed to this national crisis. As much as Diabetic Investor believes these type of hearings are nothing more than theater, we would take particular enjoyment watching these folks squirm in their seats as they attempt to explain how what they did actually help patients with diabetes.

Sadly, other than bring a smile to many faces, this won’t change the fact that millions of patients will needlessly suffer from their suspect conclusions. They can pontificate all they want about how they were acting in the best interest of patients but the reality is they care only about themselves and personal advancement.

Just as Doctor Frankenstein believed he was creating life but needed up creating nothing more than a monster, Dr. Nissen, the FDA and our elected officials have created a national disaster. Perhaps the worst aspect of this whole mess is that Dr. Nissen, the FDA or these blowhard politicians won’t personally suffer from what they have created. Like Dr. Frankenstein, they let monster loose on the public who will pay the ultimate price. This is not science or leadership this cowardice in its purest form.  

As Teddy Roosevelt once said; “Cowardice is the unpardonable sin.”