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EnteroMedics: Fat Zapper or Pulsing Placebo?

Stocks in this article: ETRM ARNA VVUS

Undeterred, EnteroMedics went back to the drawing board to design a second phase III study that could prevent control patients from losing so much weight. That brings us to the present and the RECHARGE study currently underway.

RECHARGE enrolls 233 obese patients, all of whom are implanted with VBLOC devices. Like the previous study, two-thirds of patients will be randomized to active treatment with a fully functional VBLOC. The remaining one third of patients in the control arm will have devices that are never turned on. EnteroMedics hopes that by using truly sham devices in the control arm -- no nerve blocking electrical signal at all -- the RECHARGE study will not suffer from an artificially high placebo effect.

Results from the EMPOWER trial make it easy to be a VBLOC skeptic, but there is little doubt about the power of placebo, particularly in medical device trials. EnteroMedics admits that some patients feel a sensation when the VBLOC device is active and blocking the signals of the nerve. In RECHARGE, patients in the treatment arm were likely to feel when their device was working. Control arm patients felt nothing (since their devices were dummied) and could have realized they weren't receiving active treatment.

Patients who know they're in a placebo or control arm can quickly lose motivation to participate. In the RECHARGE study, patients randomized to the control arm may not adhere to diet and exercise, limiting weight loss or even causing weight gain.

This is the scenario under which EnteroModics has the best shot at producing positive results favoring VBLOC in the RECHARGE study.

We'll know soon enough.

A quick note on comparing VBLOC to competing weight loss treatments: Gastric bypass surgery patients lose an average of 28% of their body weight. For the sample female patient standing 5' 4" and weighing 240 pounds, that equates to 67 pounds or an EWL of 70%.

VBLOC under no circumstances will achieve an EWL of 70%, so from an efficacy standpoint will always be inferior to gastric bypass. VBLOC, however, requires less invasive surgery and patients likely suffer fewer side effects. It's also reversible.

FDA has set a minimal efficacy threshold for weight-loss pills of equal to a 5% or more reduction in body weight compared to baseline (and placebo adjusted.) To meet this minimum threshold, VBLOC needs to demonstrate an EWL of 13% (again, using the 5' 4" female patient with a 41 BMI.)

To hit a 10% weight-loss standard, the equivalent EWL is 26%.

Keep these conversions in mind when EnteroMedics releases the VBLOC results. If the VBLOC study is positive but the numerical weight loss is equivalent to or less than what's seen with Vivus' Qsymia or Arena's Belviq, the device's commercial potential will be severely curtailed.

-- Reported by Adam Feuerstein in Boston.

Adam Feuerstein writes regularly for TheStreet. In keeping with company editorial policy, he doesn't own or short individual stocks, although he owns stock in TheStreet. He also doesn't invest in hedge funds or other private investment partnerships. Feuerstein appreciates your feedback; click here to send him an email.
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