) reported a loss of 40 cents per share in the third quarter of
2012, wider than the Zacks Consensus Estimate of a loss of 33
cents and the year-ago loss of 10 cents per share. Higher
selling, general and administrative (SG&A) expenses for
pre-commercialization activities for obesity drug, Qsymia, led to
the wider loss.
The company's net product revenues of $41,000, reflecting the
shipment of 656 Qsymia prescriptions, were far below the Zacks
Consensus Estimate of $1 million. The company did not record any
revenues in the prior-year quarter.
During the quarter, research and development (R&D) expenses
shot up 148.8% year over year to $9.3 million. The increase was
attributable to the initiation of post approval studies for both
Qsymia and erectile dysfunction (ED) drug Stendra (avanafil).
SG&A expenses increased to $31.3 million compared to $5.2
million in the year-ago period. The huge rise in SG&A
expenses was due to higher pre-commercialization expenses for
Qsymia was approved by the US Food and Drug Administration (FDA)
in July 2012. The FDA cleared Qsymia as an adjunct to a healthy
diet (low on calories) and increased physical activity for
chronic weight management in obese (Body Mass Index, or BMI - 30
or more) or overweight (BMI - 27 or more) adults suffering from
at least one weight-related co-morbid condition.
Vivus is working on increasing access to Qsymia and submitted an
amendment to the Risk Evaluation and Mitigation Strategy (REMS)
to the FDA for the same.
On the third quarter conference call, the company stated that
4,904 Qsymia prescriptions were dispatched in October 2012 (until
October 26, 2012).
Meanwhile, the Committee for Medicinal Products for Human Use
(CHMP) of the European Medicines Agency (EMA) recommended against
the approval of Qsiva (proposed trade name of Qsymia in the EU).
The CHMP arrived at this decision in October.
The CHMP rendered a negative opinion due to concerns over the
potential cardiovascular and central nervous system effects
associated with the long-term use, teratogenic potential and use
by patients for whom Qsiva is not meant.
Vivus plans to appeal the decision and has communicated the same
to the CHMP. A new decision in expected in the first half of
The company is looking for a partner to commercialize Stendra in
its territories, which includes the US.
Neutral on Vivus
We currently have a Neutral recommendation on Vivus. The stock
carries a Zacks #3 Rank (Hold rating) in the short run. We note
Arena Pharmaceuticals Inc.
) is preparing for the launch of its obesity drug Belviq along
with its partner
Eisai and Co Ltd.
), which got FDA approval in June 2012.
Orexigen Therapeutics, Inc.
) is also developing a candidate, Contrave, targeting the
lucrative obesity market.
ARENA PHARMA (ARNA): Free Stock Analysis
(ESALY): ETF Research Reports
OREXIGEN THERAP (OREX): Free Stock Analysis
VIVUS INC (VVUS): Free Stock Analysis Report
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