On Thursday, VIVUS
The pharmaceutical company stands to benefit from two drugs: one to help menopausal women and one to help obese people.
In late March of this year, VIVUS announced an agreement with KV Pharma
VIVUS is set to receive an upfront $10 million payment at the closing of the deal, an additional $140 million upon approval of the New Drug Application for EvaMist, and payments of up to $30 million based on sales milestones. The NDA is under review by the FDA, with a decision expected by July 29.
With a current market cap just north of $300 million, the EvaMist deal is significant for VIVUS; the company stands to gain $140 million upon approval for a drug with peak estimated sales of around $100 million. It appears likely that the FDA will approve EvaMist based on a similar topical estrogen-replacement therapy product approved earlier this year: Biosante's
However, the major potential for VIVUS lies in its experimental obesity drug, Qnexa, which had positive results released last year in a small study with 200 patients. Qnexa is a combination of already-approved drugs topiramate (better known as its brand Topamax) and phentermine. The company is expected to initiate a larger phase three trial for Qnexa later this year. The major upside for VIVUS based on the potential for Qnexa could come as a major licensing deal, or, given the current biotech buyout binge, a takeover by a larger biotech or drug company.
Mike Havrilla, R.Ph., B.S., Pharm.D., is a Rite Aid pharmacist who lives and works in the small Pennsylvania town of Portage. He invites your comments and feedback at firstname.lastname@example.org. Mike does not have a position in any company mentioned here. The Fool has a disclosure policy.
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