Vivus: EU to recommend against its obesity drug
MOUNTAIN VIEW, Calif. (AP) — Vivus Inc. said Friday it believes a panel of advisers to the European Union's health agency will recommend against approving its weight loss drug Qsymia.
Vivus said its opinion is based on "preliminary feedback" from the Committee for Medicinal Products for Human Use. The panel is expected to make a recommendation in October. After that the European Medicines Agency will make a ruling on the marketing of Qsymia.
If the drug is not approved, Vivus said it will file a new marketing application or appeal the agency's decision. Vivus wants to market the drug in Europe under the name Qsiva. The drug received U.S. approval in July, and it is Vivus' only marketed product.
Shares of Vivus fell $2.54, or 10.7 percent, to $21.18 in morning trading, but for the year to date, shares have more than doubled.
Vivus announced Monday that Qsymia is now available in the U.S., making it the first long-term prescription weight loss drug to reach the market since 1999. The Food and Drug Administration approved the drug in July for adults who are obese or overweight and have at least one weight-related condition such as high blood pressure, diabetes or high cholesterol.
The FDA also approved Arena Pharmaceuticals Inc.'s drug Belviq in June, and Belviq is expected to go on sale in early 2013. Qsymia is generally seen as the more effective of the two drugs.
Cowen & Co. analyst Simos Simeonidis said Vivus may have trouble getting Qsiva approved because European regulators are concerned about the effects of phentermine, one of the drug's two main ingredients. Phentermine is a stimulant that suppresses the appetite, and it was part of the fen-phen diet drug cocktail, which became a popular weight-loss prescription in the 1990s.
However fen-phen was linked to heart valve damage and the other ingredient, fenfluramine, was withdrawn from the market.
Simeonidis said that if Qsiva is not approved, it hurts Vivus' chances of being acquired more than it would hurt the company's revenue. He expects sales of the drug in Europe to reach about $700 million a year in 2019, and said Vivus would probably market Qsiva through a partnership that would give it around $150 million of that amount. He expects U.S. sales of Qsymia to reach $1.6 billion that year.
The analyst reiterated a "Neutral" rating on the stock.