Posted (12:30): Amylin Pharmaceuticals (AMLN) is down $1.10 and options order flow is bearish on talk of a negative Citi research not related to FDA approval letter for monotherapy use of Byetta. Shares are down and options volume is 3X the average daily, with 13,000 puts and 1,530 calls traded. Jan 10, 12.5 and 15 puts are seeing brisk trading and implied volatility is moving into the triple digits, from about 67 percenyt the day before.

Update (13:25): From Reuters, “Shares of Amylin Pharmaceuticals Inc fell 10 percent on Wednesday after the U.S. Food and Drug Administration requested that the company conduct additional safety studies on its diabetes drug Byetta.
A letter posted on the FDA’s website requested that the drug company conduct additional studies to ensure that the benefits of Byetta, known generically as exenatide, outweigh the risks of inflammation of the pancreas and acute renal failure.” (Link to story)