Vivus Inc. failed to win U.S. approval to introduce the first new prescription diet pill in more than a decade, becoming the second experimental obesity treatment rejected by regulators in the past two weeks.
The Food and Drug Administration asked Vivus to assess the heart risks of the medicine, Qnexa, and evaluate its potential harmful effects on the development of a fetus, the Mountain View, California-based company said late yesterday in a statement. Vivus also must submit the results of its completed two-year Sequel study of the drug. Outside advisers to the FDA recommended against approval in a 10-6 vote in July over concerns Qnexa may cause birth defects and increased heart rate.
Vivus has been competing with Arena Pharmaceuticals Inc. and Orexigen Therapeutics Inc. to introduce options for the estimated one-third of Americans who struggle with obesity. The FDA asked for more information on Arena’s drug last week and scheduled a panel review of Orexigen’s product for Dec. 7.
“We doubt additional pre-clinical or clinical data will be required, but we suspect there will be concern about the safety” of Qnexa, said William Tanner, an analyst at Lazard Capital Markets in New York in an Oct. 25 note to clients. “That concern could be dealt with by a tight” risk-management plan “and restricted distribution, but that would clearly impair the drug’s commercial potential.”
Qnexa sales may reach $450.9 million in 2015, according to the average estimate of three analysts surveyed by Bloomberg. Vivus sold global rights to its only marketed product, Muse for erectile dysfunction, to Meda AB this month.
Vivus gained 5 cents to $6.13 at 4:30 p.m. New York time yesterday in Nasdaq Stock Market composite trading. The stock has dropped 33 percent so far this year, including a 55 percent decline the day after the advisory panel vote.
Hedge funds own 33 percent of Vivus shares, according to data compiled by Bloomberg. Citadel Advisors LLC reported a 5.1 percent passive stake in Vivus yesterday to become the company’s third-largest holder with 4.12 million shares. Devon Spurgeon, a spokeswoman for Chicago-based Citadel, declined to comment.
The FDA hasn’t approved a prescription weight-loss drug since Roche Holding AG’s Xenical in 1999. Safety issues have spelled the demise of medicines for losing weight, including Wyeth’s fen-phen in 1997, Sanofi-Aventis SA’s rimonabant in 2007 and Abbott Laboratories’ Meridia this month.
Qnexa is a once-daily pill that works by using a controlled-release formula of low doses of phentermine and topiramate. The chemicals act on the receptors of the brain that control appetite and sense of fullness.
Topiramate, an anticonvulsant, is the generic form of Johnson & Johnson’s Topamax. The drug can trigger an irregular heartbeat and psychiatric issues led by depression, anxiety and hallucinations. Phentermine, a component of fen-phen, is still sold as a short-term appetite suppressant.
The FDA didn’t require any new clinical studies of Qnexa though it may call for another study if its safety concerns aren’t satisfied, Vivus said in the statement.
“We remain confident in the efficacy and safety profile of Qnexa demonstrated in the clinical development program and look forward to continue working with the FDA toward approval for the treatment of obesity,” Leland Wilson, Vivus’s chief executive officer, said in the statement.
A 56-week study showed Qnexa helped severely obese people lose an average of 14.7 percent of their body weight, compared with 2.5 percent on placebo. Side effects included anxiety, depression, memory and attention lapses, and increased heart rate.
Seeking a Partner
Safety and patent concerns have left Vivus as the only one of the three companies developing weight-loss drugs without a marketing partner. Arena, of San Diego, partnered its lorcaserin pill with Tokyo-based Eisai Co., and Orexigen, also of San Diego, has teamed up with Takeda Pharmaceutical Co. of Osaka, Japan on its Contrave pill.
Vivus reported a net loss of $54.3 million in 2009 and hasn’t recorded an annual profit since 2000. The company had $11.6 million in cash and near-cash items at the end of June, according to data compiled by Bloomberg.
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