We often refer to drug development as a marathon because of the long road it takes to get a drug through clinical trials and the regulatory process. Orexigen
And then it bonked, a term marathoners use for hitting the wall. Down 70%, it's just sitting there paralyzed.
The FDA is requiring Orexigen to run a trial measuring cardiovascular events in patients taking its obesity drug, Contrave, before it can be approved. Investors were hoping that the agency would follow the FDA panel's 11-8 recommendation to allow the company to run the trial after the approval.
The FDA's move doesn't shock me. As I said when the FDA's experts voted, many seemed to want a pre-approval trial but didn't think that moving the goalposts on the company was fair. The FDA cares a lot more about safety than it does fairness.
How long are we talking? It's still too early to tell. Management needs to meet with the FDA to see exactly how large a trial should be and for how long the agency wants it to follow patients.
The Scout trial measuring cardiovascular events in patients taking Abbott Labs'
Orexigen's best move might be to climb on a stretcher and head home to start training for the next marathon. The drugmaker has a second-generation obesity drug called Empatic, which also contains bupropion, the active ingredient in GlaxoSmithKline's
I know Orexigen looks tempting at the beaten-down levels, but investors would be wise to wait until the company picks itself up off the pavement and tells investors exactly which path it plans to run down next.
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