By Randall Osborne
Less than a year after lending $30.6 million to its partner, Amylin Pharmaceuticals Inc., for the ongoing Phase III development of pramlintide for diabetes, Johnson & Johnson is pulling out of their collaboration.
"We re-evaluated the cost and resources implications and concluded it's no longer in our best interests to continue the collaboration," said Bob Roach, spokesman for New Brunswick, N.J.-based J&J's Robert Wood Johnson Pharmaceutical Research Institute. He declined to comment further.
Richard Krawiec, spokesman for Amylin, of San Diego, said the company was "shocked" by J&J's decision to give the required six months' notice it is ending the deal, begun in June 1995.
The terms of the partnership call for repayment of the $30.6 million loan within 12 months after the launch of pramlintide, or after the first $50 million in revenues is earned from it, Krawiec said.
Amylin, which employs 262 people in the U.S. and Europe, will cut its work force by 25 percent and forge ahead with the development of pramlintide. The company expects to file for regulatory approval of pramlintide for Type I diabetes in Europe in the first half of 1999 — one year earlier than had been planned, Krawiec said.
Results from the European Phase III trials in Type I and Type II diabetes are expected by the end of this year, and Phase III results from the U.S. trials are expected next year.
Amylin said its plans in the U.S. are unchanged, and the company expects to file a new drug application with the FDA for pramlintide against Type II diabetes in the first half of 2000.
"We believe [J&J's pullout] was a portfolio decision, related to timing as well as resources," Krawiec said, noting that J&J recently signed a $40 million agreement with Ergo Science Corp., of Boston, to develop Ergoset for Type II diabetes and obesity.
Last November, Amylin delayed completion of four ongoing Phase III trials in the U.S. and Europe of pramlintide, a synthetic analogue of the human hormone amylin, for diabetics using insulin. Amylin said it wanted to extend the duration or add patients to all of the trials. (See BioWorld Today, Nov. 14, 1997, p. 1.)
"This is a financial decision, not a drug decision," Krawiec said. "[J&J] has seen no new clinical trial results since August, and we anticipated much more robust data from the new trial design, in the fourth quarter."
Amylin has received $163 million from the J&J deal as of the end of 1997, and is due to get another $12 million, Krawiec said.
"We have $53 million on hand, and we're cutting our burn rate, so we'll have cash for a year," he added.
News of J&J's decision broke after the market closed Monday. Amylin's shares (NASDAQ:AMLN) ended the day at $5.062, down $0.187. *