Jan. 28 (Bloomberg) -- Furiex Pharmaceuticals Inc. rose the most in more than two years after partner Takeda Pharmaceutical Co. won U.S. regulatory approval for a new diabetes treatment.
Furiex rose 66 percent to $35.34 at 4 p.m. New York time, in its biggest gain since June 2010. Takeda, based in Osaka, Japan, advanced 1.4 percent to 4,615 yen at the close of Tokyo trading, the highest since December 2008.
The Food and Drug Administration cleared Takeda and Furiex’s alogliptin and two combinations of the treatment to use with diet and exercise for patients with Type 2 diabetes. Morrisville, North Carolina-based Furiex said in a statement that it will receive a $25 million payment as a result of the approval as well as royalties based on U.S. sales.
“Alogliptin helps stimulate the release of insulin after a meal, which leads to better blood sugar control,” the FDA said Jan. 25 in a statement.
The approval gives Takeda a new revenue source as cheaper generics erode earnings from Actos, its largest sales contributor and once the world’s biggest diabetes drug. Takeda, whose application for alogliptin was twice rejected by the FDA, has projected net income would fall to a 13-year low of 120 billion yen ($1.3 billion) in the 12 months through March 2015. The company said it plans to sell the medicines beginning in mid-2013.
Actos sales peaked in the year ended March 2011 at $4.5 billion for Takeda and accounted for 27 percent of the company’s revenue at the time.
Alogliptin is in the same class of drugs as Merck & Co.’s Januvia, which generated $3.3 billion in 2011, and Bristol-Myers Squibb Co.’s Onglyza, which sold $473 million that year, according to data compiled by Bloomberg.
The first rejection of alogliptin came in June 2009, when the FDA said clinical data was insufficient based on new guidelines on diabetes treatments and cardiovascular risks released in December 2008. Takeda conducted additional studies for its resubmission. In April last year, the FDA asked for more information on the use of the medicine in other countries.
In the U.S., 25.8 million children and adults, or 8.3 percent of the population, have diabetes, including 7 million people who are undiagnosed, according to figures from the American Diabetes Association’s website.
Diabetes is caused by the body’s inability to use or produce the hormone insulin. It can lead to heart disease, kidney failure, blindness or amputations. Most diabetics have the Type 2 form linked to being overweight or inactive.
Alogliptin is approved in Japan and sold under the brand name of Nesina. The tablets will go by the same name in the U.S. The other products will be called Oseni and Kazano, Takeda said in the statement.
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