Everything ends badly, otherwise it wouldn’t end……

And yes, in honor of today’s Amylin / Lilly Breakup, I have quoted one of my favorite really bad movies of all time, Cocktail.

An old man goes to the Wizard to ask him if he can remove a curse he has been living with for the last 40 years. The Wizard says, “Maybe, but you will have to tell me the exact words that were used to put the curse on you.” The old man says without hesitation, “I now pronounce you man and wife.”

Bad humor better left for the golf course aside, today’s announcement brings to an end a tumultuous 9.5 year marriage that brought the world a terrific advancement, although much like a horribly spoiled child, required constant attention, and eventually doomed the relationship.

Lilly’s commitment to the treatment of diabetes can not be questioned, and nor for the matter should Amylin’s.  so why didn’t this relationship work out?  On a slide, it looks beautiful; a large pharma with considerable history in the disease state but in need of novel technology, a biotech with leadership born/bred of the same large pharma holding a high value asset already in mid-stage development.  What could go wrong?  In short, probably quite a bit, and you can ask Lilly’s other “partners” over the years that they had acquired with disturbing regularity.

Is it a “Lilly Thing” or was Amylin ill-equipped? Or did the product ever have a chance/reason to be sold in a primary care environment?  Novel and elegant science, a premium priced agent, is that better left to biotech?   It is an open question, and subject to a ridiculous amount of bar side quarterbacking over the years.

So what does the new arrangement mean? Investors were not excited as evidenced in the reaction today. Although much of that is driven by the “what do we know” financial implications of the divorce.  The market’s-10% reaction also generally tells me that investors didn’t give much credit to the relationship.

There is much more to be written on this subject, and it will be a absolutely fascinating start to 2012.  At Metabolic Markets, we can hardly wait.

Drop me a line, let’s have coffee and discuss, aaron@metabolicmarkets.com

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