Vivus Shares Increase on `Benign' FDA Staff Review of Diet Pill's Safety
Vivus Inc. rose in Nasdaq trading after a U.S. regulatory review of its weight-loss pill Qnexa wasn’t as onerous as some investors anticipated. Makers of competing treatments also gained.
The Mountain View, California-based company climbed $1.79, or 17 percent, to $12.44 at 4 p.m. New York time in Nasdaq Stock Market composite trading, the biggest jump since Sept. 9.
Vivus’s Qnexa, a combination of the appetite suppressant phentermine and the anticonvulsant topirimate, may cause birth defects and a “low” level of psychiatric side effects, according to a Food and Drug Administration staff review released today. The report suggests safety concerns won’t stall approval for Qnexa, the first prescription diet drug in more than a decade, said Leerink Swann analyst & Co. Steve Yoo.
“The tone of the FDA seems fairly benign,” Yoo said today in a phone interview. “Parsing the language, they’re not hammering away at the company.”
An FDA advisory panel will meet July 15 to discuss whether Qnexa should be approved. A review for Arena Pharmaceuticals Inc.’s lorcaserin is scheduled for Sept. 16, followed by Orexigen Therapeutics Inc.’s Contrave on Dec. 7. While the agency usually follows the panel recommendations, it isn’t required to do so.
Arena added 41 cents, or 11 percent, to $4.20 in Nasdaq trading, and Orexigen increased 84 cents, or 20 percent, to $5. Both companies are based in San Diego.
Diabetes, Cancer, Heart Disease
One third of American adults are obese, raising their risk of diabetes, heart disease, and cancer, according to the Centers for Disease Control and Prevention in Atlanta. With the new treatment options, the global diet-pill market may reach $10.5 billion by 2018, according to Datamonitor Plc in London.
People on Qnexa lost as much as 8.9 percent more weight than those taking a placebo in two studies, the FDA reviewers said. Medical weight management products should help people lose at least 5 percent more weight than a placebo after one year, according to agency recommendations released in 2007.
The FDA review focuses mainly on the drug’s safety, notably the potential for birth defects, psychiatric and cognitive side effects, excess acid production called metabolic acidosis, and cardiovascular risks.
High doses of topirimate are known to cause birth defects in animals. While the FDA found it “reassuring” that no problems were seen in 13 babies born to women taking Qnexa in studies, data are “much too limited” to rule out a risk, said Eric Colman, deputy director of the agency’s Division of Metabolism and Endocrinology Products. The FDA proposed a contraindication for use in pregnancy and a warning to women of childbearing age.
High Doses
Study participants taking high doses of Qnexa had three times as much anxiety and depression as people taking a placebo and were more likely to have problems with memory, attention, and language, according to the FDA review.
Qnexa also seems to affect heart rate, though “the clinical significance of the increases in heart rate is unknown,” Colman said. The agency announced that Vivus has proposed a large study to examine cardiovascular outcomes if the drug is approved for marketing.
The advisory panel may be reluctant to recommend approval with the safety risks unless they can specify that Qnexa should be used only in a certain population or in lower doses, said Thomas Wei, an analyst at Jefferies & Co. in New York.
‘Debated Issues’
“We are concerned that the totality of the debated issues will leave the panel uncomfortable with the prospect of such widespread patient exposure in the obesity indication,” Wei said in a note to clients today.
Qnexa “probably is the most effective” of the three new products, according to George Blackburn, associate director of Harvard Medical School’s Nutrition Division. He consulted for Arena in the past year and hasn’t worked with Vivus or Orexigen.
“There’s no doubt from efficaciousness, that has the best data submitted to the FDA,” he said in a June 24 phone interview. “I think the risks are going to be the big hurdle.”
Sales of prescription weight-loss drugs fell 11 percent last year to $153.7 million, according to the research firm IMS Health Inc. in Norwalk, Connecticut. Of the almost 7.5 million prescriptions dispensed, four of every five were for generic phentermine, still sold as a short-term appetite suppressant.
Fen-Phen Recall
Phentermine, one ingredient in Qnexa, is a component from the recalled diet pill fen-phen, linked to potentially fatal heart valve complications. The other product in Qnexa is a generic version of Johnson & Johnson’s Topamax, which can trigger an irregular heartbeat, kidney stones and psychiatric problems such as depression, anxiety and hallucinations.
While the FDA never approved the combination of fenfluramine or dexfenfluramine with phentermine, fen-phen, was a popular combination often prescribed by doctors. Companies can’t market these so-called off-label uses.
If Qnexa is approved, annual sales may reach $620.9 million by 2015, according to Christopher S. James, a senior equity analyst at McNicoll Lewis & Vlak LLC in New York. Vivus is also looking for a partner to market its diet pill, as Arena did this month for lorcaserin with Eisai Co., of Tokyo. “If approved, Qnexa’s unparalleled efficacy and tolerability profile will lead to rapid adoption upon its launch in late 2010-early 2011 and become the leading obesity drug for the foreseeable years,” James said in a June 25 note to clients.
Roche, Abbott, Sanofi
Roche Holding AG, of Basel, Switzerland, added warnings to its Xenical drug in May after cases of serious liver injury. Meridia, from Abbott Park, Illinois-based Abbott Laboratories, added warnings in January recommending against use in people with a history of cardiovascular disease because of an increase in heart attacks and strokes. Sanofi-Aventis SA, of Paris, was rejected by FDA in 2007 for its weight-loss drug rimonabant because of suicide and depression.
The FDA is scheduled to make a decision on Qnexa by Oct 28, six days after the deadline for Arena’s lorcaserin. Orexigen said it expects a decision on Contrave by Jan. 31.
To contact the reporter on this story: Catherine Larkin in Washington at clarkin4@bloomberg.net.
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