Amylin Pharmaceuticals Inc said that a once-weekly version of its Byetta type 2 diabetes medicine led to additional improvements in blood sugar levels over the currently available drug that must be injected twice a day.

One-year trial results show that long-acting Byetta, known chemically as exenatide, lowered blood sugar by about 2 percent, compared to a decrease of about 1.9 percent after 30 weeks of treatment. Patients treated with regular Byetta, which has been on the market since 2005, and is the only approved drug in the class, saw a 1.5 percent decrease in blood sugar.

The results follow an 18-percent drop in Amylin's shares since the release on Friday of 26-week data showing that rival Novo Nordisk's experimental drug liraglutide, given by daily injection, lowered blood sugar levels by about 1.1 percent, compared with a reduction of less than 0.8 percent for twice-daily Byetta.

Jefferies & Co downgraded Amylin's shares to "hold" from "buy" on Monday, citing liraglutide's threat to Byetta, a longer-term threat from a drug being developed by Roche Holding AG, and uncertainty surrounding the regulatory path for Amylin's long-acting drug.

The diabetes medicines are part of a class known as incretin mimetics designed to induce the same effects as a blood sugar-improving hormone called GLP-1.

"Exenatide once-weekly is poised to become best in class," Amylin chief executive Daniel Bradbury said in an interview.

Amylin's study, presented at a meeting of the American Diabetes Association in San Francisco, involved 295 patients with type 2 diabetes, the most common form of the disease. After an initial 30-week trial, 258 patients continued treatment with just the long-acting drug.

Seventy-four percent of all patients in the study achieved a target hemoglobin A1c -- a key measure of sugar in the bloodstream -- of seven percent or less at 52 weeks.

Statistically significant weight loss of about 9.5 pounds (4.3 kg) on average was seen with both patient groups. Weight loss is a highly desirable result in a diabetes treatment as obesity is a major cause of the disease. Some older drugs cause weight gain.

Amylin said no cases of major hypoglycemia, or dangerously low blood sugar, were seen, while cases of minor hypoglycemia were seen in patients who were also using sulfonylurea drugs.

In both groups, nausea was mostly mild and temporary and occurred less frequently in exenatide once weekly patients, the company said.

Bradbury said there were no cases of pancreatitis during the trial. US health officials have warned that Byetta may be linked to acute pancreatitis, or inflammation of the pancreas, in some patients.

The once-weekly exenatide uses a technology developed by Alkermes Inc, which releases the drug at a carefully controlled rate. Eli Lilly & Co has partnered with Amylin on the exenatide diabetes franchise.

"If approved, exenatide once weekly may provide patients with a treatment option that is on board 24 hours a day, seven days a week, helping to manage their blood sugar and, secondarily, their weight," Dr John Buse, study investigator and chief of endocrinology at the University of North Carolina School of Medicine in Chapel Hill, said in a statement.

Amylin has said it expects to file for US regulatory approval of the long-lasting drug by mid-2009, while Novo applied for US and European approval of liraglutide last month.

Bradbury said Amylin is "actively working to accelerate" the filing timeline by securing FDA approval of drug produced at a new manufacturing plant. - Reuters