Less than a week after Pfizer decided to stop selling Exubera inhaled insulin, the Chairman of rival drug developer Alkermes cautioned that it’s AIR inhaled insulin could also affect diabetics’ lung function.

Richard Pops, Chairman of Cambridge, Mass.-based Alkeremes, told Reuters that the inhaled insulin that the company is jointly developing with Eli Lilly & Co., may also have the potential for pulmonary risks for diabetics using the drug.

Pops explained that his company is “assuming that pulmonary insulins in that regard are all pretty much the same,” but added a caveat that the 2-year long AIR insulin drug safety trials have not been completed yet.

This blog has long-reported on concerns by doctors and diabetics about Exubera’s known and unknown pulmonary risks. The fact that a competing drug developer openly acknowledged similar concerns is significant.

It’s official: Pfizer’s Exubera inhaled insulin experiment is over.

Sales of the diabetes drug were a complete failure. Some might even think of them as non-existent, considering that Pfizer paid Sanofi-Aventis $1.3 billion to acquire exclusive worldwide rights to market the insulin, yet only generated $4 million in sales for Q2 2007.  The company’s website for the drug acknowledged that “too few patients are taking Exubera.”

Pfizer CEO Jeffrey Kindler told shareholders in an October 18, 2007 company press release that, “[d]espite our best efforts, Exubera has failed to gain the acceptance of patients and physicians. We have therefore concluded that further investment in this product is unwarranted.”

It cost Pfizer a whopping $2.8 billion in pre-tax charges to stop Exubera sales, according to an SEC filing that the company made.

According to Pfizer CFO Frank D’Amelio, the drugmaker had approximately $661 million of Exubera inventory.  That’s a staggering amount of unsold insulin.

Although Pfizer’s website for Exubera emphasized that the company’s decision to stop selling the diabetes drug “was not based on any safety problems with Exubera” and that it remains “a safe and effective medicine,” that conclusion remains subject to debate among some endocrinologists and diabetics.

One Pfizer employee recently disclosed alleged problems at Pfizer’s Exubera inhaled insulin manufacturing plant in Terre Haute, Inc.:

The person disclosed that:

“[T]here are several issues with [Exubera’s] manufacturing process…lets just say it’s not efficient or effective. As for the powder processing, they still have agreements with Nektar to produce a certain % of the powder used. This product will be lackluster at best. If things don’t get better in 6 months I see a bleak future for that site and the drug.”

That doesn’t sound well for Pfizer’s Terre Haute, Indiana employees.