This Obesity Drug Hits the Market, but Check Your Expectations

Watch stocks you care about

The single, easiest way to keep track of all the stocks that matter...

Your own personalized stock watchlist!

It's a 100% FREE Motley Fool service...

Click Here Now

VIVUS' (Nasdaq: VVUS  ) Qsymia has hit pharmacy shelves first, beating Arena Pharmaceuticals' (Nasdaq: ARNA  ) obesity drug Belviq, which has to wait for the Drug Enforcement Administration to sign off on its potential for abuse; and Orexigen's (Nasdaq: OREX  ) Contrave, which isn't even approved yet since it's waiting for safety trial data.

Interestingly, VIVUS didn't issue a press release or make a big deal about the availability two months after it gained FDA approval. The availability was noted on Qsymia's website and in an SEC disclosure. Is that a sign of confidence, or is VIVUS trying to avoid hyping up investors' expectations? My guess is the latter.

VIVUS is launching without a partner. It has enlisted the help of a contract sales organization, PDI (Nasdaq: PDII  ) , to hire 150 sales reps, but management of the sales force will be internal. That'll get the job done, but don't expect the same kind of well-oiled machine that a launch from a big pharma could provide.

Without a big direct-to-consumer campaign, the difference between a fast and slow launch will come down to doctors' enthusiasm for Qsymia. On one hand, there hasn't been a new obesity drug in many years. But doctors were burned by post-launch side effects of Abbott Labs' (NYSE: ABT  ) Meridia and before that by Fen-Phen; I have a hard time seeing doctors putting most of their obese patients on Qsymia right after the launch. As with many drug for diseases that aren't immediately life-threatening, my guess is doctors will take a wait-and-see attitude, perhaps initially just prescribing to patients who ask for it.

That isn't to say Qsymia and Belviq can't be blockbusters. There's certainly a need, considering more than 35% of U.S. adults are obese. And the drugs work, Qsymia to a greater extent, but with more side effects.

But I think investors need to think a little longer term. Until doctors gain more confidence in the drugs and insurance companies decide to cover the drugs, sales are likely to be slow.

Long-term thinking is the only way to build long-term wealth. With that approach in mind, Fool analysts have identified three stocks that can help you retire rich. Find out what they are and just why the analysts like them so much in the Fool's new free report. Click here now to claim a copy.

Fool contributor Brian Orelli holds no position in any company mentioned. Check out his holdings and a short bio. The Motley Fool owns shares of Abbott Laboratories. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days. The Motley Fool has a disclosure policy.

Read/Post Comments (2) | Recommend This Article (2)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On September 17, 2012, at 9:06 PM, ready2chang wrote:

    Finally an article that's not too biased toward neither company/drug.

    It's gonna be a tough sell for VVUS doing mail-order.

    If VVUS have such a great potential why no BP wants to partner with them? They already went through all ther bumps and bruises why not?

  • Report this Comment On September 19, 2012, at 3:55 PM, bhasa04 wrote:

    Belviq (Lorcaserin) weight-loss clinical trial patient Ed Susman (who is a MedPage reporter in real life) lost 55 lbs in one year.

    His weight went from 293 to 238 lbs, that is 55 lbs. In other words, he lost 18% of his body weight.

    The low 3% weight loss number often quoted by "Experts" is nonsense. This drug will be a blockbuster once people start realizing the amount of weight they can lose without major side effects

Add your comment.

Compare Brokers

Fool Disclosure

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2020037, ~/Articles/ArticleHandler.aspx, 10/20/2016 5:52:57 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Today's Market

updated Moments ago Sponsored by:
DOW 18,162.35 -40.27 -0.22%
S&P 500 2,141.34 -2.95 -0.14%
NASD 5,241.83 -4.58 -0.09%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

10/20/2016 4:00 PM
VVUS $1.11 Up +0.01 +0.91%
VIVUS CAPS Rating: **
ABT $40.74 Up +0.73 +1.82%
Abbott Laboratorie… CAPS Rating: *****
ARNA $1.59 Up +0.06 +3.92%
Arena Pharmaceutic… CAPS Rating: **
IDXG $0.15 Up +0.01 +3.96%
PDI CAPS Rating: No stars
OREX $2.78 Up +0.07 +2.58%
Orexigen Therapeut… CAPS Rating: *