San Diego-based Orexigen Therapeutics has been smacked down hard by the FDA, and now the company has decided it’s time to throw up its hands and find something else to do.
Orexigen (NASDAQ: OREX) said today it is putting on hold any further development of its obesity drug programs after getting what you’d have to call discouraging feedback from U.S. drug regulators. The FDA, according to a securities filing, said it would need to see results from a big randomized study of long-term cardiovascular outcomes (heart attacks, strokes) in patients before it would consider approving Orexigen’s experimental weight loss treatment, naltrexone and bupropion (Contrave). The agency, according to today’s filing, shot down Orexigen’s proposal to approve the drug for sale in a niche of patients with low cardiovascular risks in the interim, while awaiting results of the proposed long-term cardiovascular study. And, even if Orexigen agreed to this long and expensive new cardiovascular trial, the FDA said the requirements could all change in 2012 after the agency plans to convene an advisory panel on cardiovascular studies related to obesity drugs.
You can almost feel the frustration of Orexigen’s executive team seething through the normally dry securities filings that describe this encounter with the FDA.
The FDA’s request for a new study “is unprecedented and would generate significantly more information than is necessary or feasible,” Orexigen said in today’s filing. CEO Mike Narachi, in a statement, said he was “very disappointed” with the FDA’s stance. While Orexigen plans to formally appeal the FDA’s decision, it has decided for now that it should speed up its development plans outside the U.S., and start looking for other things to do.
“The company has been evaluating other opportunities where it can leverage its management team, cash and other resources,” Orexigen said in today’s statement.
Orexigen stock had been rising this week in anticipation of a more positive interaction with the FDA, but this news sent the company’s stock down more than 30 percent at the opening bell, to $2.19.
The company has been on quite a roller coaster the past six months. In December, it surprised analysts by winning a positive 13-7 vote from an FDA advisory panel for Contrave, prompting speculation that the FDA would soon give the company the green light to start marketing the new drug. But by February 1, Orexigen found itself in the same place as competitors Arena Pharmaceuticals and Vivus, reporting bad news that its application to market a new obesity drug had been turned down by the FDA. Orexigen spent part of the last few months seeking further clarity from the FDA, and trying to find an alternative route to the market, like getting approval in a niche of patients with low cardiovascular risks.
There’s a lot of history, and reasons why the FDA is so concerned about safety of obesity drugs, which I won’t belabor here today. But obviously, obesity is a huge market now that an estimated two-thirds of people in the U.S. are considered overweight or obese, which raises their risk for a whole raft of chronic ailments like diabetes, heart disease, arthritis, and depression. The FDA and Big Pharma still remember the fen-phen diet drug safety debacle of the 1990s, and there have been other more recent safety concerns linked to drugs like rimonabant (Acomplia) from Sanofi-Aventis and sibutramine (Meridia) from Abbott Laboratories.
The consistent signal from FDA panels over the past year was that the safety bar is very high for a treatment that could be taken by millions of people with a chronic, non-life threatening condition. And now for at least one company, it appears the safety bar is too high to make this a reasonable business opportunity in the U.S.