Vivus basks in limelight of rampant M&A speculation

Posted under Arena Pharmaceuticals, Blog, Companies, Diagnostics, Funding, Medical Devices, Medical Supply, Mergers and Acquisitions, obesity, Orexigen Therapeutics, Pharmaceuticals, Qnexa, Startups, Universities, Videos, Vivus, ZafGen by John Carroll

In yet another sign of just how quickly biotech investors can change their minds, Bloomberg is running a piece today speculating on which Big Pharma company is most likely to swoop in and pay a big premium for Vivus ($VVUS)--which has been flying high on its recent lopsided panel vote favoring approval of the weight drug Qnexa. And the suddenly popular obesity field--which had been relegated to the dust heap of biotech history by a number of observers--has even inspired takeover interest in the fledgling Zafgen, a 2009 Fierce 15 company.

A year ago Vivus was a cautionary tale. Stiff-armed by regulators concerned by safety concerns, it appeared indefinitely stymied alongside rivals Orexigen ($OREX) and Arena ($ARNA). But after managing to resolve most of the panelists' concerns by its willingness to restrict the pill to a carefully defined patient population, Vivus is now the odds-on winner in the race to an approval. And analysts have dollar signs in their eyes as they share gossip on a multibillion-dollar takeover bid by the likes of J&J ($JNJ) or Merck ($MRK).

Rodman & Renshaw has helpfully outlined potential peak sales at a mammoth $5 billion, according to Bloomberg, making Vivus a valuable prize for a Big Pharma company looking to beef up its income. It should be noted that other analysts have been far more cautious in their projections, but few doubt that the drug could be a blockbuster once on the market.

"The FDA has clearly crossed the Rubicon of balancing risk and benefit, understanding that the obesity problem is a pandemic," Rodman's Michael King tells the business news wire, which always enjoys a good M&A rumor story. "There are not a lot of products around in the pharmaceutical industry that address such large market opportunities. Vivus is not going to give this up cheap."

Vivus and its rivals have been criticized for offering up drugs with only marginal impact on body weight. But the same can't be said for Zafgen, which has racked up some inspiring early-stage results for its approach. And CEO Tom Hughes says that he's received overtures from pharma companies interested in buying him out.

Of course, despite the panel vote, some observers still have a nagging feeling that regulators will go ahead and require a cardio safety study ahead of an approval, rather than after. And that would crash the stock price. Vivus isn't waiting to find out, though. Vivus is offering 8.5 million shares while the stock price is high. And several insiders, including the CEO, have been cashing in on their options.

- here's the article from Bloomberg

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Orexigen surges on FDA trial pact for troubled weight loss drug

Posted under Arena Pharmaceuticals, Blog, Companies, Contrave, Diagnostics, Funding, Medical Devices, Medical Supply, obesity, Orexigen Therapeutics, Pharmaceuticals, Startups, Universities, Videos, Vivus by John Carroll

Shares of Orexigen Therapeutics ($OREX) shot up 18% yesterday after the biotech laid out a special protocol assessment pact with the FDA, detailing the design of a big new safety study of its weight drug Contrave. But investors are going to have to wait quite awhile before they get a better idea of the developer's chances at a comeback.

Orexigen made headlines when it raced Vivus ($VVUS) and Arena ($ARNA) to the FDA with an application for a weight drug, vying for the lead in a race for the first new obesity drug approval in more than a decade. But the biotech was handed a major defeat when regulators concluded that they needed hard evidence that a treatment designed to be used by a mass audience didn't have any hidden cardio risks. Orexigen then lined up $87 million in new funding for the study, vowing to complete the quest.

In the SPA, Orexigen and the FDA agreed that investigators will recruit 10,000 patients and then see how long it takes to hit 87 major adverse cardio events in the patient population. Once they hit that stage--which the developer estimates will be in less than two years--Orexigen will come up with an interim analysis and see if it can win an approval with the data.

"A few months ago, we received detailed written correspondence from the FDA's Director of the Office of New Drugs that identified a clear and feasible path forward for this important potential obesity therapy," says CEO Michael Narachi. "We believe the rapid progress we have since made with the FDA's Division of Metabolic and Endocrinologic Products on the detailed protocol and plans for analysis is further indication of the alignment we have reached within the FDA on the requirements for resubmission of the Contrave NDA."

- here's the press release
- read the Reuters story
- get the report from the San Diego Business Journal

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Sanofi CEO challenges FDA to clear up regulatory pathway for new meds

Posted under Blog, Chris Viehbacher, Companies, Diabetes, Diagnostics, FDA, Funding, Medical Devices, Medical Supply, obesity, Orexigen Therapeutics, Pharmaceuticals, Sanofi, Startups, Universities, Videos by Ryan McBride

Drug developers have had it with FDA reviews of new meds for major diseases such as diabetes and obesity. U.S. regulators have shot down or stalled a slew of applications for such drugs because of safety concerns, and Sanofi ($SNY) CEO Chris Viehbacher has called for the agency to clear up how it weighs the risks and benefits of the treatments or risk a drain on the industry's investment in developing them, Reuters reported.

"You're starting to see primary care diseases becoming somewhat neglected," Viehbacher told Reuters, wearing his hat as the chairman of the Pharmaceutical Research and Manufacturers of America (PhRMA). "To make sure we're not ignoring unmet needs in primary care, we need a lot more clarity around the risk-benefit so there's predictability when we invest in these products."

Developers in the obesity and diabetes fields are likely to applaud Viehbacher's stance. In June, Orexigen CEO Michael Narachi blamed the FDA's lack of clarity on ways forward for obesity treatments as a threat to his and other companies' investments in diet pills. Last year the FDA wouldn't approve San Diego-based Orexigen's ($OREX) weight-loss drug Contrave because of potential heart-safety risks to certain patients, but the company is trying again to get the agency's nod for the treatment after meeting with regulators about data it would need to gain approval.

With obesity and diabetes weighing on the U.S. healthcare system, drug lobbyists are likely to make a strong case for getting the FDA to shed greater light on what companies need to prove in order to bring new treatments for the conditions to market. And if the regulatory waters remain murky for such meds, expect drugmakers to play it safe and divert funds toward safer bets in oncology, where drugmakers have had lots of success getting the FDA's approval stamp for new therapies.

- read the Reuters article

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