Michel York - IR Daniel Bradbury - President & CEO Mark Foletta - SVP, Finance & CFO Vince Mihalik - SVP, Sales and Marketing & CCO

Mark Schoenebaum - ISI Group Yaron Werber - Citi Thomas Wei - Jefferies Jim Birchenough - Barclays Cory Kasimov - JPMorgan Josh Schimmer - Leerink Swann Ian Somaiya - Piper Jaffray Tom Russo - Robert Baird Mario Corso - Caris & Company

Good afternoon and welcome to Amylin Pharmaceuticals quarterly update conference call. We have uploaded a presentation to accompany this conference call that provides additional background on the quarter.

Today's discussion will contain forward looking statements that involve risk and uncertainties. These risks and uncertainties are outlined in today's press release, the website presentation and in our recent filings with the Securities and Exchange Commission.

Our actual results could differ materially from what is discussed on today's call. Let me introduce the other members of the Amylin Management Team here today.

Daniel Bradbury, President, Chief Executive Officer; Mark Foletta, Senior Vice President, Finance and Chief Financial Officer, and Vince Mihalik, Senior Vice President, Sales and Marketing and Chief Commercial Officer. I will now turn the call over to Daniel Bradbury.

Thanks, Michael and welcome to our second quarter call. This afternoon our comments will build on the press release issued earlier today.

In a few moments, Mark will provide additional details on the quarter's underlying financial results and comment on our outlook for the rest of the year. Vince will then review our commercial activity during the second quarter and highlight our plans for the remainder of the year.

At the beginning of the year, I laid out for you four areas of focus for 2010 that we believe will help maximize shareholder value. I will now provide a brief update on our progress during the quarter as it relates to those goals.

First, we remain focused on driving revenue of our existing products. Through the first half, we've not met our expectation for revenue generation.

However, we continue to track very encouraging prescription trends for the GLP-1 receptor agonist class. In fact, monthly new prescriptions for BYETTA grew 20% in June; an overall growth for the class remained strong.

As we head into the second half of the year, we will continue to aggressively promote the benefits of treatment with BYETTA and SYMLIN that we've established over the past five years. Second, we remain focused on successfully launching BYDUREON.

In the second quarter, following our response to the complete response letter, we received a revised PDUFA Action Date of October 22nd. We're confident in our response and are continuing our discussion with the FDA to bring this important new therapy to patients this year.

Third, we plan to achieve positive cash flow from operations by the end of 2010 on a sustainable basis and for the full year of 2011. Our non-GAAP operating loss for the second quarter was $7.4 million, a 67% improvement over the same period last year.

We remain on track to achieve these goals, realize the benefit of the significant operating leverage we built into our business and drive bottom-line growth. And finally, as we focus on long-term value creation for shareholders, we intend to continue to advance our pipeline.

Our plans to submit the clinical and non-clinical sections of a new drug applications for the use of metreleptin to treat severe lipodystrophy remain on track. With no treatment currently approved to treat severe lipodystrophy, we believe that based on published studies, this treatment could become an important new option to help patients impacted by this debilitating metabolic disease.

We also announced earlier in the first half, that in conjunction with our partner Takeda, we have decided to move pramlintide/metreleptin towards Phase 3 clinical studies. This is a key step forward towards making a new peptide therapy for the treatment of obesity available to patients.

Additionally, we continue to invest strategically in the exenatide franchise. The development of a pen for BYDUREON remains on track, and we are planning to have it available to patients late in 2012 or early in 2013, contingent on a timely regulatory review.

We have also initiated a Phase 2 study of a monthly dose suspension formulations of exenatide during the second quarter and we expect to see data from this study in the first half of 2011, driven on a ground body of clinical and post-marketing data while leveraging the potency of the exenatide molecule and the Alkermes' Medisorb technology, we believe this formulation represents the first truly viable opportunity for a monthly dose therapy for type 2 diabetes. Now, before we continue into a more detailed discussion on recent activities.

I will turn things over to Mark Foletta to review our financial results released earlier today.

Thanks Dan. Today we announced our financial results for the quarter ended June 30, 2010.

As Dan mentioned, and we have discussed in previous calls, we are managing the business with operational discipline, and are focused on generating sustainable, positive operating cash flow and maintaining a strong cash position. Our measure of operating cash flow, non-GAAP operating loss was $7.4 million for the second quarter, compared to $3.8 million in the first quarter.

We expect continued variability in our operating results over the next few quarters due to incremental expenses to support the launch of BYDUREON. BYETTA sales were down $9.1 million sequentially, or 6% and total prescriptions were down 8% during the period.

BYETTA sales this quarter also reflect a May, price action on the 10-microgram dose. SYMLIN sales were down $0.7 million, or 3% sequentially, and total prescriptions were down 1%.

Wholesaler inventories of both products at June 30 were consistent with inventory levels at March 31. In a moment, Vince will speak in more detail regarding commercial activities.

Selling, general and administrative expenses decreased $2.6 million or 3% sequentially. As a reminder, we expect incremental investments to support the BYDUREON launch later this year that will be reflected in our SG&A expense line.

Research and development expenses increased by $4.2 million or 10% sequentially. The increase primarily reflects the timing of expenses associated with BYDUREON, including manufacturing readiness activities, cost associated with the recently initiated cardiovascular outcome study and cost associated with the exenatide life cycle management development activities.

Our total operating expenses in the second quarter were $120.2 million, slightly higher than the $118.6 million in the first quarter. We believe that our current run rate in the $120 million per quarter range reflects approximate spending levels for our core operations, with expected variability in the next few quarters due to incremental investments to launch BYDUREON.

We ended the quarter in a strong financial position with $574 million in cash and investments. We remain well positioned to execute our business plans.

I'll now quickly review bottom-line results for the first half of 2010. Keep in mind our key financial metric is non-GAAP operating loss, which is our measure for operating cash flows.

Non-GAAP operating loss includes 74% to $11.2 million for the first half of 2010 from $42.2 million for the same period last year. For full details of our financial results, please refer to the press release we issued earlier today.

I would now like to reaffirm the key trends and assumptions we provided last quarter to help better frame our outlook for the remainder of the year. Most importantly, I want you to know that we remain on track to deliver sustainable, positive operating cash flow by the end of this year.

We continue to expect our non-GAAP operating loss to further improve in 2010, compared to 2009. We plan to exit the year with positive operating cash flow on a sustainable basis, leading to non-GAAP operating income for 2011 and GAAP operating profitability by the end of 2011.

We continue to expect that non-cash adjustments used to determine our non-GAAP operating results in 2010 will be between 110 and $110 million, compared to 97.7 million in 2009. The increase reflects incremental depreciation expense associated with our manufacturing facility in Ohio.

While our non-GAAP operating loss is the key measure for 2010, I will now provide some further quantitative and qualitative guidance to assist you in understanding our expectations. I will begin with collaborative revenues.

Our collaborative revenues consist of milestones and non-cash amortization of debt from payments. Beginning in 2011, we expect to begin earning BYETTA, BYDUREON or U.S.

royalties which will also be included in collaborative revenues. For 2010 we expect to earn a $40 million milestone from Eli Lilly upon the launch of BYDUREON in the United States.

Additionally we will recognize $7.5 million of collaborative revenue from ratable amortization of the $75 million upfront payment we received from Takeda in 2009. We continue to expect out net interest expense to be 25 to $30 million.

With respect to our cash flow, I would add the following comments. Capital expenditure, net of reimbursements from Lilly will be lower than the $98 million net expenditure in 2009.

2010 capital expenditures will be principally focused on strategically investing in exenatide life cycle management. We are assuming that we repay our outstanding secured debt balance of $78 million in 2010.

We continue to expect to finish 2010 with a substantial cash balance and well funded to launch by BYDUREON. As we are approaching the launch, I would like to provide additional details around our expectations for gross margins.

As we have previously noted we are targeting margins for BYDUREON of at least 75%. Our manufacturing facility for BYDUREON has significant capacity to address expected global demand.

Fixed plant expenses are expected to be at least $100 million annually, approximately half of which is non-cash depravation. Since majority of these costs are fixed, we will incur them regardless of production volumes.

Therefore there will be a transition period of at lest several quarters following the launch, where BYDUREON margins would significantly lower than our target margins as these fixed costs will be spread over lower levels of production. As demand for BYDUREON grows overtime, we will realize economies of scale and drive toward our targeted margin for the product.

Now let's take a moment to explain differences in the gross margins of BYDUREON compared to BYETTA. First we have paid a high single digit royalty on net sales to Alchemy.

Second, material costs consisting of active pharmaceutical ingredient and product components for BYDUREON were higher by BYETTA. Third unlike BYETTA, where production is outsourced, BYDUREON's cost of goods will include non-cash depreciation associated with our manufacturing plant.

Importantly our cash margins would be higher than our reported margins for BYDUREON which is not the case with BYETTA. In conclusion given the unique profile of BYDUREON and compelling clinical data we have seen in the DURATION program, we believe that we have the potential to generate significant gross profit dollars and operating leverage.

This positions us to drive substantial bottom line growth and total share holder return. To wrap up my remarks I want to reaffirm our continued commitment to drive additional efficiencies in our business and to achieve positive operating cash flow on a sustainable basis by the end of this year, while making the investments necessary for a successful BYDUREON launch.

Now I will turn the call over to Vince to review our commercial activity. Vince?

Thank you, Mark. The Amylin sales and marketing organization continues to remain focused on our day-to-day business, driving revenue for our currently marketed products BYETTA and SYMLIN and preparing for the launch of BYDUREON.

From a comfort standpoint, we had a strong presence at this year's ADA conference with new data supporting safety and efficacy profile of BYETTA, SYMLIN and BYDUREON. It's noticeable that we had more than 25 abstract presentations including five oral presentations and a busy commercial exhibit.

Our detailed key data presented as I provide updates on each products. Now let me go on to discuss our result in the second quarter starting with BYETTA.

As a reminder, BYETTA is the first FDA approved GLP-1 receptor agonist available on the market. BYETTA addresses specific unmet needs with the dual benefits of powerful glucose control with potential weight loss, supported by a low risk of hypoglycemia.

Sales were down approximately 6% quarter-over-quarter reflecting an 8% decrease in total prescriptions, which was partially offset by pricing actions. Encouragingly, new prescriptions for BYETTA increased 20% in June relative to May with total prescriptions growing 4.2% month-over-month.

We believe this trend is a direct result of improved execution by the Amylin and Lilly sales forces and have grown GLP-1 receptor agonist market. As our respected sales forces continue to settling into their new territories following recent restructuring events, we believe there is still room for improvement.

Additionally, we continue to observe other positive dynamics in the diabetes market during the second quarter. Since the launch of the second, daily dose GLP-1 receptor agonist in February, four week moving averages indicate that total weekly prescriptions for the GLP-1 receptor agonist have grown by approximately 11% with weekly new prescriptions growing by approximately 38%.

Using the same moving average analysis, weekly new to brand prescriptions, a subset of new prescriptions, used a leading indicator for NRxs and TRxs have grown approximately 138%, though assured the new GLP-1 prescription is down from 100% of the market, as expected, we're benefiting from the overall growth rate in new to brand prescriptions for the class. We continue to see these trends as a clear sign and the market is willing to adapt new entrance into this important class of therapies, a sign that bodes well for the launch of BYDUREON.

Data presented at the ADA Conference held at the end of June in Orlando, support the well-established safety and efficacy profile of BYETTA, the studies presented included several analysis of large managed care databases, demonstrates that BYETTA use was not associated with the increased rates of pancreatitis compared to other diabetes therapy. These studies add to the growing body of evidence that supports the notion that exenatide is not associated with increased risks of developing pancreatitis.

Additionally, we unveiled results from the first double-blind, placebo-controlled clinical study to evaluate BYETTA added to insulin glargine. Data from this study shows that the combination of BYETTA and insulin glargine help patients with type 2 diabetes achieved glucose targets without weight gain or increasing their risk of hypoglycemia.

These data suggest that BYETTA may provide a complementary addition to basal insulin for these hard-to-treat type 2 diabetes patients and will form the basis of a supplemental New Drug Application to the FDA that we plan to file by the end of this year. Along with the well-established safety and efficacy profile of BYETTA, we offer a highly favorable level of access with managed care plans.

We continued to maintain greater than 80% tier 2 access having reduce the number of step-edits by over 45%, and expect to further reduce the remaining step-edits as we move throughout the year. These are key strategic advantages in light of the current economic environment; especially as managed care organizations continually increase scrutiny of their formularies.

Now, lets move on to SYMLIN, the first then on the FDA approved Amylin analog. As a reminder, SYMLIN is our wholly owned compound that addresses unmet needs for patients with type 1 or type 2 diabetes to use meal time insulin.

SYMLIN reduces blood glucose fluctuations, improving glucose control and often causing weight loss. We continue to drive SYMLIN sales in increased awareness of the benefits of treatment with Amylin analogs.

We would also continue to focus on activities which improve persistency that we instituted during the first half of the year. SYMLIN net revenues decreased by approximately 3% during the quarter.

At the ADA Conference this year, we presented a Meta-Analysis of an integrated data base of clinical studies that showed no increased risk of cardiovascular events associated with SYMLIN use, pooled comparator group treated with either placebo or rapid-acting insulin. These safety analysis confirm our findings from individual clinical studies, and provide additional insight into the CV safety profile of SYMLIN.

As we progress to 2010, we will continue to explore partnership possibilities for SYMLIN outside of the United States. Turning now to BYDUREON, we have a PDUFA action date of October 22.

We remain confident in our submission package and are continuing our discussions with the FDA to bring this important new therapy to patients. At this juncture, the exenatide one team is continuing in full pre-launch mode and is prepared to commercialize BYDUREON in 2010.

BYDUREON has the potential to become the first, and only diabetes therapy that provides the power of continuous control for a full week with just one dose. Throughout the DURATION clinical program, BYDUREON has demonstrated consistently robust efficacy and acceptable safety and tolerability profile with just one weekly dose.

With five of the six DURATION studies having been completed, we've seen consistent A1C reduction of 1.5% to 1.9% along with the potential for weight loss. Importantly, tolerability profile has also remain consistent with less than 1% of patients withdrawing from clinical studies due to nausea.

These results have been achieved in patients across the continuing of type 2 diabetes care from drug naïve patients to those feeling multiple oral [ph] agents. Our presence at the ADA conference this year was highlighted by oral presentations of the results from DURATION-2 and DURATION-3 studies during the joint ADA events at the symposium.

In both of these studies, patients treated with BYDUREON achieved superior glucose control relative to comparators, which included Actos and Januvia in DURATION-2 and Lantus in DURATION 3. In addition to the DURATION-2 and 3 results, data from DURATION-5 represented as a late breaking poster.

Also of note, a field analysis of safety and tolerability data from the DURATION-1, 2 and 3 studies was presented. This analysis demonstrated the overall incident rates of adverse events, serious adverse events and discontinuations due to serious adverse events, which was similar for BYDUREON versus pulled competitors.

Importantly, in the DURATION-1, 2 and 3 studies, there were no reports of severe hypersensitivity actions such as serious skin reactions or anaphylaxis. This data further support the non-safety profile of the exenatide molecule, and are consistent with the previously reported profiles of BYDUREON and BYETTA Based on the data we've seen to date from the DURATION program, we have also committed to running a cardiovascular outcome study with BYDUREON, which we call EXSCEL, the exenatide once weekly study of cardiovascular event lowering.

Patient enrollment commenced during the second quarter of this year, in contention upon event rates, we're expecting the study to complete in 2016. Extentide is a revolutionary molecule and we intend to continue to strategically invest in it.

We continue to work on developing BYDUREON, which we anticipate would be available to patients by the end of 2012 or early in 2013. Additionally, from the second quarter we commenced a phase two proof of concept study of a monthly dose suspension formulation of extentide.

This monthly dose formulation does not require reconstitution and leverages a unique potency of extentide. As we continue to build on the heritage of BYETTA, we will explore novel and convenient ways to deliver the benefits of extentide therapy.

Let me close my portion of the remarks by saying that we are continually encouraged by the momentum we are seeing within our company and our work with the extentide one team and our collaboration with Lilly and in the marketplace. We believe we have transitioned to a commercial model that is more effective, efficient and customer focused to provide value.

Even as we plan for the launch of BYDUREON, our organization remains dedicated to driving the new turn revenue performance for BYETTA and SYMLIN. And now I'll turn the call back over to Dan for his closing remarks.

Thanks Vince. In closing I'll add just a few more comments.

Importantly we've established a clear path forward with the approval of BYDUREON. With the PDUFA Action date set for October the 22nd, we remain in dialogue with the agency and are squarely focused on our goal of bringing this important medicine to patients this year.

While we're not satisfied with product revenue this quarter, we will continue to drive revenue from our currently marketed product BYETTA and SYMLIN while preparing for the launch of BYDUREON. Our sales and marketing organizations remain in full prelaunch mode while continuing to educate the market on the dual challenges of glucose and weight control, covering a majority of people with type 2 diabetes.

Also as Mark noted during his review of our financial results this quarter, we continue to efficiently manage our business to keep expenses in line with revenues. The direct result of this financial discipline is evidenced by fact that we remain on track to achieve our stated goal of being cash flow positive from operations as we exit 2010.

And looking forward we continue to strategically invest in the exenatide franchise and advance our most promising pipeline assets. We are carrying tremendous momentum into the second half of 2010 and we remain focused on executing our business plan while advancing our mission to improve the lives of people with diabetes.

I will now ask the operator to open the lines for questions.

Hey guys, thanks a lot for taking my question. I appreciate it.

I was just wondering if you could update us on DURATIN-6 and I'm interested in three variables, at least that's, any design, details you could give us, timing for that trail and I'd also love to know the rationale of why you think you have a good probably showing superiority over liraglutide and then my second question was for Mark, can you just clarify your gross margin did I miss it, did I hear you correctly that a 100 million would be fixed, this is just a clarification, sorry about that.

Hi Mark, thanks very much for your question, Dan here. So, let me start firstly with DURATION-6.

So DURATION-6, we got an update and I think one of the key updates there is the fact that the studies is now fully enrolled and we fully expect to the reporting results in the first half of next year. The study exceeds a 900 subject study, it's an open label study in patient to both monotherapy and combination therapy failures in type 2 diabetes.

In regarding your question about the rationale of why we believe that we can demonstrate superiority versus liraglutide, but I think if you look at the BYDUREON results as we reported from DURATIONS 1 through 5, we're seeing a very consistent effect with regards to the benefit of the product in terms of glucose control. The consistency of that fact is significantly different when you look at the reported studies, the lead studies with regards to liraglutide.

And so when you go back and analyze that and look at the delta, you will see that is actually pretty significant delta in terms of the reports differences there and with the 900 patients study, it gives us very strong statistical powering to show a difference between the two. So, that's basically the answer to your question, I'll hand over to Mark with regards to clarification on the margin.

Yeah, Mark Foletta here.

Hi, Mark.

With respect to the 100 million of labor and overhead at the plan, I didn't say that and those are largely fixed costs associated with labor overhead and non-cash depreciation, we said that the depreciation would be approximately half of that and that those costs really are incurred at the plant more or less regardless to production volumes.

Okay, got it, thanks a lot. I'll get back in the queue, I appreciate it.

Thank you, Mark.

Hey guys, thanks for taking my question too. So, I had a question about, two questions.

One has to do with, help us understand a little bit, where do you see the BYETTA sales trends over the balance of the year and what should we assume to, should we assume that will sort of have a flattening with the recent price increase or just help us, let me understand how you're thinking about everything and then secondly, I had a question about, you mentioned there is going to be incremental spending associated with BYDUREON launch both on SG&A, how, I don't know if you can give us any expense over the ramp there and then finally what percentage of your R&D currently or do you assumes those fixed cost from production because you're already employing these individuals or ultimately going to be involved in producing BYDUREON's. How much of it is going to be a switch of rule from R&D percent?

Hey, and thanks very much for your questions. The first question regarding BYETTA, the sales trends, I'll ask Vince here to give you some comments there generally, I would remind you we don't guide specifically product revenues.

So, his comments will be general. Regarding the second two questions on incremental spending on SG&A and the percent of R&D, associated with manufacturing, I'll ask Mark to comment on, so Vince?

Thank you, Yaron for the question. Obviously, we are more than satisfied with revenue in the quarter but we are seeing some positive trends.

As I commented on the call, we are clearly seeing in our NRx growth that's now translating to a very positive month-to-month comparison. As you know, we saw a 20% growth in June, and we saw an uptick in TRx of 4.2% in month-to-month in June so a good strong trends.

My comment would be that we are seeing growth in GLP-1 market, and as I commented on the call, the four week moving averages, definitely show a TRx trend, that's a 11% growth and NRx up 38%. So, clearly we are seeing additional writers now prescribing in the space and a move towards greater proportion of GLP-1 usage.

Mark, do you want to comment on the…

Yeah Yaron. Let me take your first question, the SG&A ramp.

You know don't want to guide that specifically, obviously, it's going to depend somewhat on the timing of approval, and how we incurred the cost. But just remember, it's half of the cost associated with the launch because Lilly will incur the other half.

And I want to frame that we will, will hit the guidance that we have given in terms of being non –GAAP positive as we exit the year. So, that helps you as well.

We will earn a milestone, 40 million as I said in the prepared remarks. But we think there is ample room with that to invest in the launch, and make it a successful launch, and still hit our financial targets.

Referring to -- I think you referred to it as the switcheroo from R&D to cogs. Yes I'm glad you asked that question.

And actually it's a further clarification I think of Mark's question, you really should think of the 100 million of fixed costs. Largely those cost are already being incurred in our income statement.

The vast majority of those cost are already being incurred through our income statement in the R&D line predominantly, and that will transition to cost to inventory, and cost to goods sold. So, economically we really are already burdened in our non-GAAP and GAAP results for the vast majority of those costs.

The incremental costs, in terms of labor and overhead, will predominantly be non-cash as we bring further equipment on, and depreciate it. And of course you will have variable cost associated with materials as we begin to ramp and build inventory.

Have you been buying all the essential components of the actual injector device, already in anticipation of the launch, and are those already expensed into your P&L as well?

So, we have been -- there has been activity in terms of components. Obviously, the labor and overhead has been incurred, and that has been going through our P&L really since the fourth quarter of 2009.

That's great. Thank you.

Thank you.

Thanks John.

All right, thanks. I just wanted to clarify on the operating cash flow positivity.

So that does include the $40 million milestone payment?

Hi, Thomas. It may or may not.

In terms of the goal for the company, obviously, the milestone is dependent upon the launch of the BYDUREON. If BYDUREON doesn't launch, then we won't incur the additional cost that are associated with the launch of the product.

Either way, we are sticking to our guidance of being positive operating cash flow by the end of 2010.

And so, it's just a follow-up on your own question. It sounds like, in the scenario where you don't, and your operating cost, you are saying are pretty much fixed at $120 million level that you are assuming that BYETTA stabilizes in the subsequent quarters of the year?

No. Again, Thomas, we don't give guidance specifically with regards to revenue, and I think that that will be too close to guidance in that regard.

Okay.

The only thing I will add to that Thomas is that, really three of the last four quarters we have been fairly close in the non-GAAP measurement. One quarter, in the third quarter of last year we actually were slightly positive.

The last two quarters you see we've been less than been $10 million. So we certainly believe that the core business and that includes cost associated with prep for BYDUREON in terms of the R&D side as we just discussed in response to Yaron's question, that will move in the income statement.

So we're very confident that the expense control that we put in place, it is continuing that we'll hit the targets that we have set.

And just to understand a little bit better on overall cost growths in some -- a lot us don't get access to this new to brand prescription data. Can you help us understand maybe, when you talk about the 138% growth, I don't quiet understand what timeframe you’re doing that calculation against and can you talk about whether or not your new to brand prescriptions for BYETTA have actually stabilized or started growing again on an absolute basis?

Thanks very much Thomas. I will pass to Vince on that one.

Yeah Thomas. The timeframe I'm talking about for the same week moving average that I talked about in TRx and NRx and when I talked about the new to brand sub segment growing a 138%, that's since the launch another GLP-1 in the market space.

So we're seeing since that launch a big growth in new to brand and in fact that new to brand growth is where we're seeing GLP-1 surpass TCDs [ph] and DPP-4s as a percent of what physicians are prescribing in the diabetes markets. So it's very strong growth.

The second part of your question Thomas, I tried to pick it up.

Just the most recent dynamics in that new to brand data, are you seeing a stabilization of your absolute new to brand prescriptions or even some re-growth there or are you continuing to see that number decline?

No we definitely saw re-growth in new to brand for our own product and obviously that's beginning to translate now into growth in NRxs that you're beginning to see.

I'm sorry, just one last thing. What if I -- can you quantify for us or give us some sense of the magnitude of that growth relative to where it had bottomed out at or where you were before the launch of the Victoza?

Well, it's a comment I made in the call itself. Thomas we saw a 20% improvement month-to-month in June just in NRxs.

Okay, thank you.

Thank you, Thomas.

Yeah, hi guys just a few questions. Number one, just wondering if you can give us an update on discussions with the FDA in terms of finalizing the BYDUREON label in the REMS.

My understanding from talking to Orville at ADA is you need to finalize the label before you have something to refer to for the REMS discussion. So where are you at in that process?

Hi Jim, yeah just to say that we continue to be confident with regards to approval of BYDUREON by the PDUFA date. It would be inappropriate of me to give you specific details with regards to ongoing discussions with the agency.

However I would confirm that Orville is correct in terms of the process that the label needs to be finalized prior to the agreement on the REMS.

And maybe just a follow up from Mark just on the fixed cost associated with manufacturing. If that's going to transition from R&D to COGS but your R&D line, it's sounds like it's going to remain pretty stable at the current run rate, where is that additional cost that's coming into R&D coming from, is there is some cushion in that R&D spend line?

So, Mark.

Yeah let me clarify Jim, we didn't really say that R&D was stable at this rate, what we really said was combined R&D and SG&A spending. We have seen three of the last four quarters, it's been right around a 120 million and we think that's a good measure for kind of the core business but for launch related expenses.

There certainly will be movements within those expense lines and so I want to caution you to assume that R&D will necessarily will be flat, I think in the short term what you have is duration rolling off with one ongoing and we have got this cardio-vascular study ramping but I want to caution you to be that granular and that you really should think of our income statement as a whole that the operating expenses will for the core businesses around that level.

Jim, maybe just one thing I would add to what Mark said and that is I would emphasis that we will continue to invest in exenatide going forward. Mark mentioned the EXSCEL study but also the BYDUREON pen as well as of course Phase 4 support for the launch of BYDUREON and further the once monthly formulation which is ongoing at the moment as well.

As well as our obesity programs which we have of course the partnership with Takeda.

And just trying to hit everyone in the room if I can ask Vince a final question and that is do you think the uptick in prescriptions for BYETTA or this new to brand metric for BYETTA is a reflection of better retention or persistence on BYETTA with patients waiting for the twice for the once weekly, is there any dynamic where we are seeing patients staying on the drug longer as they anticipate it once weekly?

Well Jim, we appreciate you not leaving Vince out, so I will hand over to him.

Thanks Jim. Yes actually I do we think we're seeing some improved persistency.

We have been focused on patient program we call BYETTA By Your Side and I do think that has helped us with persistency. But that's not the only variable that's occurring here.

So, it's a piece of it but it's not the whole picture but it does contribute to the improvement we're seeing in NRx.

Great. Thanks for taking the question.

Thank you Jim.

Hey. Good afternoon guys.

Most of my questions have already been answered but do want to quickly just ask about Europe. First of all can you confirm it you are still no track to begin receiving royalty payments from Lilly by the beginning of next year and then second are you able to provide any insight into BYDUREON's regulatory status over there?

Hi, Cory thanks for the questions. Regarding your first question yes I would confirm that we do believe that we are in track to start receiving royalties from the beginning of next year.

Secondly with regards to the BYDUREON regulatory status, yes it's on track at this point and we expect to receive, well Lilly is expecting to receive approval in the first half of next year.

Okay. Thank you.

Thank you.

Hi Josh, yes I will ask Mark to clarify about the 75% gross margin.

75% is more important, yeah we have really covered kind of the fix cost that will be spread across fewer units early on, and that's really what's driving that. Again, yeah a lot of these costs are already in our income statement as I've said though.

They are not really incremental except for the variable cost that will be added. In terms of guiding the slope of that transition, and the timing, there is a number of variables would play here.

Obviously, our pricing decision upon getting a final label, the rate of demand in uptake in United States, and then the timing of approval, and the launch and the uptake outside the United States, which will significantly help that leverage as Lilly will purchase those units from us. So, to guide a specific transition at this time or the timing is not appropriate.

One thing I would want you to think though is that you think a blended exenatide margins don't include both BYETTA and BYDUREON and certainly earlier on as BYDUREON is ramping, you will have a higher percentage of the higher margin product BYETTA, which the margins are very strong as you know. And also this cash, non-cash situation that we talked about as you are ramping BYDUREON, the non-cash portion is more significant than it is at steady state.

So, the metric of cash flow that we are focused on will benefit from that. I think now just to finish off, we are really confident that the growth that we can generate from BYDUREON will generate significant gross profit dollars, and the financial leverage and the model to hit in our business to hit the mid-term financial targets that we've had, which is, as you know, non-GAAP, positive non-GAAP results for 2011 and GAAP profitability by the end of next year.

And then maybe one quick other question now. What percent of patients with congenital lipodystrophy have mutation that's likely to respond to Leptin replacement?

Well, that's a great question. And I don't think it's actually anybody on this call is in the right place to answer that question.

So, what I would do George, is I will take that question on advisement and we will get back to you. Thanks very much.

Great, thank you.

Thanks. I had a couple of questions.

One, you mentioned that there is been an absence of signal related to hypersensitivity in the DURATION sizes. Wondering if the FDA at any point requested data from BYETTA's real world experience?

Two, just on the inventory side, is that a target inventory level that you plan to have, or want to have at the time of launch and what is the shelf life of BYDUREON? And last question, if I may, the dual chamber device, what impact does that have on gross margins?

Thanks. I had a couple of questions.

One, you mentioned that there is been an absence of signal related to hypersensitivity in the DURATION sizes. Wondering if the FDA at any point requested data from BYETTA's real world experience?

Two, just on the inventory side, is that a target inventory level that you plan to have, or want to have at the time of launch and what is the shelf life of BYDUREON? And last question, if I may, the dual chamber device, what impact does that have on gross margins?

Yeah, hi Ian. So, let me take those questions in order, so firstly with regards to hypersensitivity.

You know just a couple of comments there. Well, first and foremost, I guess, the most important thing to comment is that there has been no serious systemic hypersensitivity reactions observed in the DURATION program to date.

With regards to your comment regarding BYETTA, you know the -- anything relating to hypersensitivity which included as part of A, the submission relating to because for the submission, of course, we completed a full analysis of the entire exenatide database, that was further updated just prior to the agency completing their review. It was also then further augmented as part of the complete response.

The bottom-line here with regards to hypersensitivity, with regards to BYETTA is that it's a very, very rare event being seen as in less than 0.01% of patients. And we were able to make that statement given the fact that we now have over 1.5 million people exposed to BYETTA and 1.3 million patient years of exposure.

I'll hand over the second question that you have relating to inventory to Mark.

Yes, so actually I think you had three sub -- one, I believe the first one Ian was target inventory levels for BYDUREON. It's too early for us to talk about that.

We are certainly going to build enough inventory to meet expected demand and hit our financial targets and preserve cash. So we certainly are comfortable with our plans there.

In terms of, I think you asked about shelf life of our product?

I did.

I did.

And that's dependent obviously around the final label with the FDA. Vince, do you want to comment on that?

Usually we provide stability data as part of the NDA and obviously the FDA reviews that and comes back and gives you a recommendation from their perspective as part of your label.

And then your last question was really, looking out in the future of pen margins and I just say that, a little too early to guide there other than we believe that we'll generate pharmaceutical type margins certainly within the range that we're seeing with, at least with what we're seeing with the first form of BYDUREON.

But does it go up, does it go down or is sticking right around 75?

But does it go up, does it go down or is sticking right around 75?

It's too early for us to guide in that regard at this point.

Okay, thank you.

Okay, thank you.

Thank you.

Hi, thanks for taking the question. In the past you guys have said that the pricing decision for BYDUREON will be data driven and it seems like it would have to be made before the DURATION-6 trial wraps up and I was just wondering if you could comment on how you manage pricing before getting that data point.

That would be my first question.

Hi Tom. Yeah, thanks for the question.

Yeah, absolutely it will be data driven and of course, we've now completed five of the six DURATION studies. However at this point we also, we don't have a finalized label with the agency and until such time as we know exactly what the claims are that we're going to be able to make to the product at the time of launch, we're going to hold back on finalizing our pricing strategy.

I'm also monitoring I would say what's going on in the marketplace as I'm sure, I note that you're acutely aware the environment that we're all operating in these days is changing rapidly and one of the things that we want to be able to do is to take into account the latest data with respect to environmental changes by the time we make a pricing decision.

And then maybe revisiting, I've been on from this call but a little bit different way, can you give any color on whether coming up a little bit short on BYETTA relative to your expectations in the second quarter is due more to the degree of share lost in the first long acting products or segment growth or something else and then I'd be curious if you make any read through from that to either higher or lower expectations for your once weekly product.

Yeah, great questions there Tom. Perhaps Vince, maybe you'd like to comment there?

Yeah so Tom, thanks for the question. This relatively small impact on BYETTA monthly from switching which I think is what's behind your question in terms of giving color on share loss and it's the bulk of I think the likely patient switches are behind us at this point.

For now the growth in the GLP-1 markets is clearly going to have to come from new patient starts and we are starting to see that as I said in the new -to-brand data that we're seeing the GLP-1 class surpass TCDs and DPP-4 as a percentage of what endocrinologists in particular are prescribing. But we are seeing growth in adoption throughout the GLP-1 market and as I commented during the call the new-to-brand is up almost twice what it was and that's both for PCPs and endocrinologist and although GLP-1s are growing fastest with endocrinologist, 75% of scripts for GLP-1s are coming from PCPs.

So, we clearly do see an opportunity for BYDUREON in this segment particular given our unique advantages for type 2 therapy with greater glucose lowering when compared to most of the frequently used brands in this space and particularly with the potential for weight loss, low risk type of hypoglycemia, acceptable tolerability all in giving the continuous control in one sweet dosing format. We think that's going to be very attractive.

And then may I ask one for Mark, can you comment since we've been discussing gross margin a bit what drove the sequential improvement in the second quarter and maybe even what is the current gross margin for BYETTA?

Certainly, in terms of what growth drove the gross margin improvements was just increased deficiency in terms of our operations and in terms of what we're able to achieve with a contract suppliers, Tom.

Yeah, I want to caution you that it was benefited somewhat by volume, so I wouldn't want you to necessarily to extend that to the second half of the year, we have quarter-to-quarter fluctuations with volumes but we're encouraged to with our managing cost throughout the business including our supply chain. But this quarter was probably a little higher than what you'll see going forward but they're very strong they're over 90% to answer your question on BYETTA markets.

Thank you Mark.

Thanks Tom.

Thank you. Two questions I wanted to ask.

Number one, based on your comments on BYETTA, longer term, I think most analyst models have BYETTA all but going away. Do you expect BYETTA to be stickier than that?

Do you envision the franchises being more of a kind of 50-50 split between BYETTA and BYDUREON and is it kind of postprandial control concept given twice a day, is that at all an important factor there and then secondly on the once a month suspension, is there enough human work done to-date where you can feel confident that you're not going to have an excessive amount of nausea and others I mean just three doses in the study and maybe that's what you're looking to find out the one's you think you're looking to find out in that study, thank you.

Yeah, thanks Mario. That's a two very good question.

Firstly, with regards to BYETTA longer term, I wouldn't want to guide a percentage here but certainly I think it's fair to say that we do believe that there is going to be a significant place for BYETTA in the marketplace on an going basis and I would in particular point to the fact that we did announce that the American Diabetes Association that we'll be submitting a supplemental MBA provided to be used in combination with basal insulin, before the end of this year as a potential utilization for BYETTA going forward. But I do think that your comment, also with regards to the role of BYETTA in the control of postprandial glucose is also very important and certainly there will be patients who will continue to benefit from BYETTA going forward as a result of the excellent efficacy that we see with BYETTA with regards postprandial control.

Your second question was relating to the once a month suspension and the potential for -- I believe those with the [ph] concern that you raised. Last year, we completed a proof of concept study using the suspension in a once a week format and one of the key things that we were looking for in that proof-of-concept study was what was the likelihood of that being excessive release of exenatide early on in the dosing.

And one of the things that we were encouraged was the fact that the some cokinetic profile that we saw in that proof-of-concept study actually would facilitate once-a-month suspension. We are now of course testing that in the clinical study that's ongoing, but I believe it's fair to say that we wouldn't be undertaking that study if we believe that there was a potential for excess and the adverse events associated with the suspension formulation.

Well, again, thank you to everybody for your interest and to your questions. We have a huge opportunity at Amylin to continue to advance on mission of discovering, developing and commercializing medicines to improve the life of patients with diabetes.

Additionally, our leadership team, and the many dedicated employees of Amylin remain focused on building the business today, and laying the necessary foundation to success tomorrow. If you have any additional questions following the call today, please call Michael York, the head of our Investor Relations team.

Thank you.