Amylin parts with Lilly, will add reps
Amylin will raise its number of sales reps from 350 to 715 to make up for Eli Lilly's departure from commercial activities, once the firm takes full control of the exenatide diabetes franchise.
Amylin was to take full control of marketing on exenatide products Byetta and Bydureon in the US by Nov. 30, and in all markets by 2013, under a deal ending the decade-old marketing alliance—and the litigation between the companies.
The deal includes total consideration of $1.45 billion. Amylin will pay Lilly an upfront fee of $250 million plus royalties of up to $1.2 billion on future sales, and a percentage of exenatide revenues if Bydureon, a once-weekly injectable version of GLP-1 receptor agonist Byetta, is not approved in the US by June 2014. Amylin will also pay a $150 million milestone to Lilly contingent upon FDA approval of a once-monthly suspension version of exenatide, now in Phase II.
Outside the US, commercial operations will transfer by December 2013. Amylin will select another marketing partner to promote Byetta and Bydureon, which was approved in the EU in June.
In a note to investors, ISI analyst Mark Schoenebaum wrote, “Amylin clearly has very high confidence in Bydureon, and if the drug is truly a mega-blockbuster, this deal will likely be viewed very positively over time.” But the relatively large upfront payment could put Amylin in “a potentially more precarious near-term cash position” if Bydureon's launch is delayed.
In May Amylin sued Lilly, obtaining a temporary restraining order that barred Lilly from proceeding with its scheme to use the same sales force to sell both Amylin's Byetta and Boehringer Ingelheim's Tradjenta (linagliptin), a DPP-IV inihibitor approved the same month.The court enjoined Lilly from disclosing confidential information about exenatide to any of its sales reps or employees participating in the marketing, promotion or sale of Tradjenta. A district court later vacated the restraining order, and Tradjenta is being launched with a Lilly-Boehringer sales force.