Vivus, Arena Drugs Fail to Burn Americans' Prodigious Fat

One more metric from Monday night's conference call I found interesting and disappointing simultaneously: Vivus said 27,000 unique patients have been prescribed Qsymia since the drug launched five months ago. A Qsymia script costs approximately $135 per month for the recommended middle dose, so under the most optimal circumstances (all 27,000 patients taking five months of Qsymia), best-case sales to date would have been roughly $18 million.

The $2 million in actual Qsymia sales reported suggests a lot of patients are trying Qsymia for a month or two, then giving up. How many patients are discontinuing Qsymia and when? Vivus was asked this question on Monday's call but declined to answer directly. The company did say 44% of Qsymia scripts shipped in the most recent four-week period went to patients who had previously purchased the drug. The company also said the rate of abandonment (patients who have a Qsymia script written but don't actually fill it) was 22%. That's lower than the 30% abandonment rate reported last fall but still fairly high.

Patients abandon Qsymia scripts because the out-of-pocket cost of the drug is too much to bear. People don't want to pay $135 per month, or more than $1,900 over the course of a year, to lose 10% of their body weight. Insurance coverage for Qsymia is still sketchy and even for those people lucky enough to get reimbursement, the co-pay is $60 per month.

Enter Arena and Eisai, which on Monday set the wholesale acquisition cost for Belviq at $199.50 per month -- a 48% premium over Qsymia mid dose. That means patients taking Belviq will be paying a lot more for less weight loss. Patients who take Belviq lose, on average, a paltry 3% of their placebo-adjusted body weight after one year. More than half of Belviq patients fail to lose 5% of their body weight after three months.

With mediocre weight-loss numbers like those, Arena and Eisai are likely to soon feel the sting of abandonment rates well above those reported for Qsymia -- that is if patients even agree to have a Belviq script written for them in the first place.

If investors believe Vivus' $1.2 billion market value is too high to justify paltry Qsymia sales, Arena and its $1.8 billion market value is heading for a significant downward adjustment once Belviq sales come up lame.

-- Written by Adam Feuerstein in Boston.

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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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