European regulators recommended the approval of Orexigen Therapeutics (OREX) weight-loss pill on Friday, opening a new commercial market opportunity closed off to the company's competitors.
I've long described Contrave as the Goldilocks of weight-loss pills, meaning its advantage is a mix of efficacy and safety sitting right in the middle between Vivus' (VVUS - Get Report) Qsymia and Arena's (ARNA - Get Report) Belviq. So far, being "just right" is working for Orexigen. Contrave market share in the U.S. is growing faster than the competition, and now, European approval is at hand. Previous efforts by Arena and Vivus to secure approval for their respective weight-loss drugs in Europe have been rejected.
Orexigen will change the brand name of Contrave to Mysimba for marketing in Europe, once final approval is granted early next year.
Here's an excerpt from the summary opinion for Mysimba announced today by the Committee for Medicinal Products for Human Use (CHMP) of the European Medicines Agency:
The effectiveness of Mysimba was assessed in four pivotal studies that included obese and overweight patients with and without weight-related conditions treated for one year. All patients enrolled in trials were required to change their lifestyle to incorporate a reduced-calorie diet and regular physical activity. Across these studies, more patients treated with Mysimba achieved clinically-relevant weight loss than patients treated with placebo.
The main safety and tolerability concerns identified with Mysimba were related to central nervous system and gastrointestinal adverse events, and uncertainties with regard to cardiovascular outcomes in the longer term. Interim results from an ongoing cardiovascular outcome trial were reassuring in terms of risk of serious cardiovascular disease related to treatment with Mysimba. A second study is planned in order to continue monitoring longer-term cardiovascular safety with the medicine.
It's interesting to note Orexigen lagged behind Arena and Vivus into the U.S. obesity market because the FDA initially rejected Contrave due to concerns about the potential for an increased risk of cardiovascular side effects in obese patients. This forced Orexigen to conduct a large cardiovascular safety study. I nterim results announced in November 2013 showed no increased heart safety risk tied to Contrave. It's these data which reassured European regulators enough to recommend the drug's approval.
Orexigen's stock price is significantly outperforming Arena and Vivus this year, as the latter two have struggled mightily to generate sales of their weight-loss pills.