Arena Pharma: Weight-Loss Drug Woes

SAN DIEGO, Calif. ( TheStreet) -- Arena Pharmaceuticals ( ARNA) efforts to resuscitate its flailing weight-loss drug suffered a setback Thursday after U.S. regulators buried the company under new and time-consuming requests for additional safety data.

Arena said it continues to believe that resubmission of the weight-loss drug lorcaserin to the U.S. Food and Drug Administration is possible by the end of the year even as it disclosed additional FDA demands. These include a request that Arena conduct a new, 12-month cancer study of lorcaserin in female rats and that the company provide additional data assessing the risk lorcaserin may damage the heart valves of patients.

FDA rejected lorcaserin in October and since then, Arena has been meeting with regulators and designing new studies to get the weight-loss drug back on track. Thursday's disclosure that the lorcaserin "to do" list is even longer than originally envisioned complicates, even jeopardizes, those efforts.

Arena is being forced to fire 66 employees, or 25% of its workforce, in a cost-cutting move, the company said Thursday. And conspicuously absent from Arena's latest lorcaserin update was any mention of support or assistance from its partner, the Japanese drug firm Eisai.

Eisai figured prominently the last time Arena updated investors regarding lorcaserin in December but not in Thursday's announcement, raising questions about Eisai's desire to remain involved with lorcaserin.

Arena's new lorcaserin problems come as Orexigen Therapeutics ( OREX) waits to hear from FDA on an approval decision for its weight-loss drug Contrave on Jan. 31. Meantime, Vivus ( VVUS) is dealing with its own new safety data request from FDA concerning its weight-loss drug Qnexa after a recent meeting with regulators.

If Arena follows through with FDA's request to design and run an additional 12-month cancer study of lorcaserin in rats, simple calendar math suggests a lorcaserin resubmission won't be possible until the first half of 2012, perhaps later depending on how long it takes the company to get the study started.

The FDA's desire to see more safety data related to lorcaserin and heart valve damage is also interesting in light of results released in November from a study of lorcaserin in diabetes patients. That study, dubbed BLOOM-DM, revealed new cases of reported heart valve damage six times higher in lorcaserin-treated patients compared to patients treated with a placebo after one year.

The actual number of patients reporting new valvulopathy in the BLOOM-DM study was relatively small but the imbalance going against lorcaserin upended data from previous phase III studies showing no such safety risk tied to the drug.

FDA did not have data from the BLOOM-DM study when it reviewed and rejected lorcaserin last fall. Lorcaserin is a close chemical cousin to fenfluramine, a diet drug that was pulled from the market because it caused heart valve damage.

Arena shares closed Thursday at $2 but was lower in Friday pre-market trading.

--Written by Adam Feuerstein in Boston.

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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.

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