Acomplia Waiting Game Continues

Sanofi now expects the FDA to act on the drug in late April rather than this year.
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Another wait for the weight-loss drug Acomplia.

Sanofi-Aventis

(SNY) - Get Report

said Friday that it now expects the Food and Drug Administration to act on the drug in late April rather than this year.

In an example of the terseness that has characterized the company's comments on Acomplia throughout the year, Sanofi-Aventis issued a two-sentence press release. It said it has filed responses to questions from the FDA, adding that the "goal" is for the agency to act by April 26.

For much of the year, ever since the FDA granted conditional approval in February, Sanofi-Aventis executives had been predicting a decision during the second half of 2006. By October, however, they weren't reconfirming those predictions when analysts questioned them during a third-quarter financial-report conference call.

Neither the company nor the FDA has identified the conditions needed for approving Acomplia, which has been endorsed by regulators in the European Union. The drug is sold in eight European countries and Argentina. The biggest markets are the U.K. and Germany. The drug is approved for people who are obese and for those who are overweight.

Although many analysts believe Acomplia can produce many billions of dollars in revenue each year, the company's silence has made some of them nervous.

Several have latched onto a recent clinical trial as a source of concern. Results released Dec. 5 said Acomplia did well in controlling blood-sugar levels of diabetics who hadn't taken medications. But the company-sponsored test also showed that Acomplia patients had higher rates of certain side effects and a higher drop-out rate vs. patients who received a placebo.

One side effect is "depressed mood," which affected 5.8% of Acomplia patients and only 0.7% of those getting a placebo. On Tuesday, Michael Leuchten of UBS Securities said this result would be "unhelpful" in discussions with the FDA.

By Friday, he was still worried about side effects. "We do not believe that the recently presented

clinical trial puts the FDA's mind at rest," he says in a research note. Leuchten, who has a neutral rating, doesn't own shares. His firm has had an investment banking relationship with Sanofi within the last three years.

Alexandra Hauber of Bear Stearns tells clients that "depression is still a key safety concern." In an October report, Hauber said the company's use of the words "depressed mood" separately from "depression" was "surprising and potentially confusing."

Hauber, who has an underperform rating on Sanofi, also expressed concern about the 9.4% drop-out rate for Acomplia patients vs. the 2.1% rate for people taking a placebo.

Some analysts say the clinical trial could help Sanofi win a claim from regulators for treating diabetes. But Hauber said the test was too small -- 278 patients -- to justify such a claim. Sanofi is conducting other clinical trials.

Still, Hauber doubts Acomplia will be approved for diabetics. She doesn't own shares, and her firm doesn't have an investment banking relationship.

A more favorable opinion came from Alistair Campbell of JPMorgan who predicted the FDA would approve Acomplia in April. Campbell doesn't own shares. His firm has had a recent investment banking relationship.

In keeping with JPMorgan's terminology for rating stocks, Campbell has an overweight rating -- on a company making a weight-loss drug.