Orexigen Therapeutics ( OREX) is expected to release the first phase III data on its experimental weight-loss drug Contrave ahead of a key investor presentation Monday.

The new Contrave weight-loss data come from one of four phase III studies being conducted by Orexigen this year. The company is one of three relatively small drugmakers -- Vivus ( VVUS - Get Report) and Arena Pharmaceuticals ( ARNA - Get Report) are the other two -- in a race to develop the next generation of obesity drugs.

In December, Vivus announced results from a phase III study of its weight loss drug Qnexa. Arena is expected to have data from its obesity drug later this year.

Orexigen has not given an exact date for the release of the Contrave phase III data other than to say an announcement will be made before the company gives an presentation to investors Monday morning at the J.P. Morgan Healthcare Conference in San Francisco.

Contrave consists of two currently approved drugs combined together to suppress appetite and fight food cravings. One of the drugs in Contrave is naltrexone, currently used to fight opioid and alcohol addiction; the other drug is the antidepressant bupropion.

In a previously reported phase II study of Contrave, patients taking the drug lost between 6% and 7% of their body weight over 48 weeks, adjusted for placebo.

In the phase III study to be reported later this week, approximately 800 patients were treated for one year with either Contrave or a placebo. Both groups of patients were also asked to go on strict diets and offered intensive behavioral modification therapy to boost their weight loss.

The added "lifestyle change" component makes predicting the outcome of the Contrave study more difficult.

In a typical obesity drug trial, patients treated with a placebo would be expected to lose about 1% to 2% of their body weight. However, in the Contrave study, the placebo patients will probably lose more weight because of the diet and counseling they're also receiving.

J.P. Morgan analyst Cory Kasimov predicts that a 6% to 7% weight loss reported by Contrave patients, adjusted for placebo, is likely enough to satisfy investor expectations.

In other words, if placebo patients manage to lose 5% of their body weight in the study, patients treated with Contrave need to lose between 11% and 12% of their body weight for the drug to be deemed successful. Kasimov has an overweight rating on Orexigen and a year-end 2009 price target of $18 a share. Orexigen is a banking client of J.P. Morgan.

The safety and tolerability of experimental obesity drugs are both very important, especially in light of safety problems that have forced older weight-loss drugs to be pulled from the market.

The U.S. Food and Drug Administration is paying careful attention to the potential for any new weight-loss drug to induce mood changes or behavioral and/or psychiatric side effects.

For Contrave, in particular, earlier formulations of the drug caused many patients to report significant nausea. A change to a sustained release form of naltrexone, being used in the current phase III Contrave study, is expected to reduce the rate of reported nausea.

Results from three other, ongoing phase III studies of Contrave are expected in the middle of the year.

Orexigen is also developing a second weight-loss drug, Empatic, which consists of bupropion and the anti-seizure medicine zonisamide.

Orexigen shares closed up 40 cents, or 6.8%, to $6.29 Tuesday.

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