In Sindarin, the diphthong [iu] developed into [ȳ], a change mentioned in The Lord of the Rings Appendix E (LotR/1115), and also in a chart describing the phonetic development of diphthongs appearing in notes associated with Tolkien’s discussion of Hands, Fingers and Numerals from the late 1960s (VT48/7). In both cases, it seems this phonetic development was the result of both original primitive [iu] as well as the diphthongs that developed when primitive [eu] became [iu]. This sound change also occurred from initial yu- [ju-], as noted by David Salo (GS/§4.92, §4.93). He suggested [ju] > [jy] > [ȳ], but I think [ju] > [iu] > [ȳ] is also possible:

• ✶julmā [> iulm(a)] > S. ylf “drinking-vessel” (WJ/416).
• ✶jūneke [> iunek(a)] > S. ýneg “twelve” (VT47/41).

The change of [ju] > [ȳ] might have been inhibited where the u was already part of a diphthong, as in N. iuith [juiθ] “use”, as was also suggested by David Salo (GS/§4.93). Since the Noldorin phonetic developments of these diphthongs were different than Sindarin, it’s hard to say for sure.

Conceptual Development: Other than a general merging of primitive [eu] and [iu], these phonetic developments were quite different at earlier conceptual stages of the language. See the entry on how [eu] became [iu] for further details, along with more examples of this sound change.