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Orexigen Therapeutics (NASDAQ: OREX), which combines a couple of generic drugs, naltrexone and bupropion, into a long-lasting formulation it hopes to market as Contrave. The other is from Mountain View, CA-based Vivus (NASDAQ: VVUS), developer of Qnexa.
None of those drugs has shown evidence that it can yet “make a dent” in the nation’s obesity problem, says Xavier Pi-Sunyer, the director of obesity research at St. Luke’s-Roosevelt Hospital in New York, a professor of medicine at Columbia University, and an investigator on the clinical trials of all three major obesity drugs in late development from Orexigen, Arena, and Vivus.
A hit drug in this disease would need to help people shed between 10 percent and 15 percent more of their body weight than a placebo, particularly because consumers will have to pay for these drugs out of their own pockets instead of getting insurance to pay, Pi-Sunyer says. Drugs like this will probably cost $150 a month, which will force many patients to really ask whether it’s worth the expense.
“I’m not sure any of the three drugs will make a dent in the problem,” Pi-Sunyer says. “When people have to pay for this out of their own pocket, they want something truly effective.”
Arena’s Lief was more optimistic. The dropout rate was similar for patients on the Arena drug and those who got a placebo. Depression rates were similar for patients on drug and placebo, and there was no increased tendency toward suicidal thinking, which was a rare side effect that ultimately prevented Sanofi-Aventis from winning U.S. approval of an obesity drug a couple years ago.
Importantly, Arena passed a rigorous test that looked at whether its drug might damage heart valves. That has been a concern since the start with this drug, because it is designed to curb appetite by hitting a similar receptor on brain cells that was blocked by Wyeth’s fen-phen drug combination in the 1990s. Fen-phen was pulled off the market because it also damaged heart valves. Arena’s drug was designed to have the same appetite-suppressing effect of fen-phen, without damaging heart valves.
Nonetheless, Wall Street reacted negatively, driving Arena stock down by 28 percent, from $4.50 to $3.23 on March 30, the day it announced that it wasn’t able to produce a 5 percentage point advantage over a placebo in average weight loss. Since then, the stock has recovered some, but not fully, climbing back to $3.92 heading into today’s medical meeting.
“Most investors have not gotten it yet,” Lief says. Many investors don’t appreciate how well-tolerated the Arena drug is, with a dropout rate similar to placebo, which is “unheard of” in the field of obesity drugs. There was also a high degree of variability in how individuals responded to the drug. About one-third of patients lost more than 5 percent of their body weight inside of two months. “Losing 5 percent of your body weight in less than two months is truly a big deal,” Lief says. “Most people don’t like to be on a diet for three to six months.”
A big check from a Big Pharma company that wants a partnership stake would go a long way for Arena in its quest to prove the doubters wrong. The company is having active talks, although Lief says he wouldn’t bet on a deal getting done until after results come out in September from another clinical trial, called Blossom. “If I were a partner, I’d want to see that last bit of data before we file (the application) to the FDA,” he says.
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