Obesity-Drug Smackdown

VIVUS (Nasdaq: VVUS  ) gained Food and Drug Administration approval yesterday for its new obesity drug, Qsymia, which will compete directly with Arena Pharmaceuticals' (Nasdaq: ARNA  ) recently approved Belviq.

Let's break down the different aspects and see who comes out on top.

  • Weight loss: Advantage Qsymia. But we already knew that from the clinical trials.
  • Retaining patients: Advantage Qsymia. Belviq's label recommends doctors stop treatment if a patient hasn't lost 5% of his or her body weight in 12 weeks. Qsymia is more liberal, only suggesting patients lose 3% of their body weight after 12 weeks of treatment. And then doctors have the choice of prescribing a higher dose of Qsymia before discontinuing treatment.
  • Ease of prescription: Advantage Belviq. Without a Risk Evaluation and Mitigation Strategy, Belviq will be easier to prescribe than Qsymia, which will be dispensed through specially certified pharmacies to help prevent pregnant patients from taking the drug.
  • Marketing: Advantage Belviq, for now. Arena is partnered with Eisai, which should be able to put more marketing muscle into Belviq than VIVUS can into Qsymia. But that assumes VIVUS launches the drug and doesn't license it or get acquired.
  • Price: Advantage unknown. Neither company has released a price yet.
  • Timing: Advantage Qsymia. Maybe. The drug will launch in the fourth quarter. Arena has to wait for the Drug Enforcement Administration to issue its scheduling of the drug since there's potential for abuse. The DEA decision typically takes four to six months, which would put the launch sometime between the mid-fourth quarter and early 2013. A few months' difference will have minimal effect on the long-term sales trajectory no matter which company comes in first.
  • Names: Advantage Belviq. Qnexa, the former name of Qsymia, might have won this one, but the name was presumably rejected by the FDA because Qnexa was too similar to the trade or generic name of another drug. The agency wants to avoid having a doctor's bad handwriting cause dispensing errors. But Qsymia? Just saying it makes me feel queasy.
  • Post-approval requirements: Advantage Belviq. Six post-approval requirements trumps the 10 the FDA is requiring VIVUS to perform. Both companies will have to perform cardiovascular outcomes studies, which will be the greatest cost, so perhaps the overall costs won't be that much.

The first four are clearly the most important. The question becomes whether Belviq's cleaner side-effect profile and potentially stronger marketing muscle can overcome Qsymia's better weight loss. Assuming most patients aren't covered by insurance, the cost of the drugs could be the deciding factor.

Of course, this isn't likely to be a winner-take-all situation. Even Merck's (NYSE: MRK  ) Victrelis, which got trounced by Vertex Pharmaceuticals' (Nasdaq: VRTX  ) Incivek out of the gate, has managed to grab some sales in the hepatitis C space.

The smackdown is just beginning, but it'll be a while before we can declare a winner.

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Fool contributor Brian Orelli holds no position in any company mentioned. Check out his holdings and a short bio. Motley Fool newsletter services have recommended buying shares of Vertex Pharmaceuticals. 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 (7) | Recommend This Article (3)

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  • Report this Comment On July 18, 2012, at 7:08 PM, NYGuy01 wrote:

    Brian,

    For the sake of disclosure I have a small position in ARNA which is barely worth talking about and I have held as a speculative play and will continue to do so. It won't make me rich or poor based on its movement. Now that i have that out of the way let me ask you about your first point. The common fact that is expounded is that Qysmia had better results in the trials and I have seen it all over the news today. On the face of that the answer is yes based on the clinical trials, but that is when the highest dose is measured against Belviq. The trials measured three doses and show that the efficacy differences between Qysmia and Belviq are negligible when looking at the low and medium dose of Qysmia. Only after failure and upgrading the dose to the higher dose will there be an appreciable difference, but that comes with a greater risk profile due to the increased dosage. Furthermore, only a certain subset of patients will be allowed to go to the higher dose at a doctor's discretion. The question is will doctor's take that risk for the greater efficacy? That is yet to be decided. So the blanket statement about efficacy of Qysmia beating Belviq in my opinion, truly needs a disclosure and should be more transparent than just a single one line statement to be fair about the comparison of the stock drugs. Thank you for reading and I hope you reply with your thoughts on this. I am just looking to have an open an honest discussion on this and not have this breakdown into a pump and bash session.

  • Report this Comment On July 18, 2012, at 8:10 PM, krapbuster wrote:

    Regarding your last bullet on post approval study costs currently Eisai picks up 90% of Belviq's tab and ARNA 10%. For VVUS they must pay themselves, assuming no partner, with estimates anywhere betwen $500 million and $1 billion for the 10 trials they must do. Otherwise fair article.

    Also to claify- top 34% responders in Lorcaserin (new Belviq) trials lost over 10% average weight, and top 25% responders lost over 16% average weight. Responders are usually identified within first 30 days. These are outstanding results without REMS, raised heartbeat levels, and for women no threat of birth defects and pregnancy. Speaking of pregnancy physicians will insist on a paid doctor visit for that monthly test for Qsymia. Problem is if you stop taking Qsymia suddenly you are at higher risk for having a seizure per label warning. Not a good plan.

    Having thoroughly studied VVUS and ARNA since 2009 we are strong believers that in the real world of physician offices that safety always trumps efficacy, and Belviq's cleaner and superior safety profile, as well as presumed overall lower costs associated with when taking into account doctor visits, is the huge winner and blockbuster weight loss drug here.

    Media coverage last 24 hours for the most part terrible with heavy slant to hedge fund backed Qsymia and negative slant for medical backed Belviq. Shows how trapped wall street is on these 2 companies having bet heavily long on VVUS and heavily short on ARNA never expecting Belviq to be approved.

  • Report this Comment On July 18, 2012, at 8:11 PM, bobleelaw wrote:

    Good article Brian but,

    I agree with NYGuy01, I have read the studies, and with the higher dose of Qsymia comes much higher risk of heart problems, and cannot be used by many high BMI people, mainly due to the fact that high BMI already causes blood pressure and heart problems in many.

    Also, you should mention that Qsymia warnings include birth defects, hence the added REMS.

    I know my wife said she would expect any woman would not even let their husband/boyfriend use the drug in fear of that. I am not saying their use would lead to a birth defect, but that just showed me the automatic fear it brings.

    I was suprised the FDA even let Qsymia pass.

    But for my money I would not buy into a higher potential problem product such as Qsymia.

    Now Vivus has things going for them, 2 approved drugs this year, maybe a buyout as you say, just my fear rating right now is to high to put my money with them.

    Thank you for the read.

  • Report this Comment On July 18, 2012, at 8:45 PM, fballstudz wrote:

    Another possibility in your second bullet point is the assumption the doctor will move to the higher dosage of Q if thd patient is not successful in losing weight, but what I would actually assume is that doctors would then try B versus the higher risk profile Q. Fair?

  • Report this Comment On July 18, 2012, at 9:08 PM, heather070707 wrote:

    Wall Street is very, very good. How else can you explain taking 2 old generic drugs and combining them and announcing a brand “New Drug” called Qsymia. That is exactly what VVUS has done and they’ve reaped an almost 200% return for 2012 and FDA approval for Qsymia of two generic drugs that are already approved? Think I’m joking, VVUS has taken generic Topriamate approved in 2009, here’s the link http://www.upi.com/Science_News/2009/04/02/FDA-OKs-first-gen... and generic phenteramine approved in 2007, here’s the link…this is the one that is causing the most concern regarding increased heart rate/heart problems and addiction. http://www.medicalnewstoday.com/releases/91731.php

    Doctors are already using this combination, they don’t have to prescribe Qsymia, they are already prescribing it.

    Here’s a story/link on tonights NBC News with Brian Williams that reports about a doctor that has been prescribing this same combination for over 10 YEARS, I’m sorry, you’ll have to watch a short commercial, but then you’ll see what I’m talking about, this doctor has been prescribing the same drug compo as Qsymia for over 10 YEARS….here’s the link

    http://www.msnbc.msn.com/id/3032619/#48233650

    Qsymia is NOT A NEW DRUG!

  • Report this Comment On July 18, 2012, at 9:47 PM, Tony925 wrote:

    In your bullet on Timing, you state that "Arena" has to wait for scheduling by the DEA. Don't you mean Vivus? It's Qsymia that has phentermine which is already a controlled drug.

  • Report this Comment On July 18, 2012, at 10:53 PM, mincasa wrote:

    Why would the FDA waite all day, and untill 7Pm to announce their decsion??this is the largest fraud and behind the seen scam,between the FDA and WS hedge funds, and VVUS adding millions in bribes , I can bet on it..

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