Back to top

Analyst Blog

This page is temporarily not available.  Please check later as it should be available shortly. If you have any questions, please email customer support at support@zacks.com or call 800-767-3771 ext.  9339.

Orexigen Therapeutics, Inc. (OREX - Snapshot Report) reported a net loss of 41 cents per share in the fourth quarter of 2012, much wider than the year-ago loss of 9 cents but 4 cents narrower than the Zacks Consensus Estimate of a loss of 45 cents per share. Revenues remained flat year over year at $0.9 million, in line with the Zacks Consensus Estimate.

Full-year loss came in at $1.27, narrower than the Zacks Consensus Estimate of $1.31 but wider than the year-ago loss of 58 cents. Revenues decreased 22.1% to $3.4 million, in line with the Zacks Consensus Estimate.

Operating expenses increased to $33.3 million during the final quarter of 2012 from $5.2 million in fourth quarter 2011, reflecting the increase in research and development expenses. Research and development expenses increased to $28.3 million from $1.5 million in the year-ago period.

The massive jump was primarily attributable to the costs for developing its obesity candidate. General and administrative expenses were up 39.9% to $5.1 million.

Along with the fourth quarter 2012 results Orexigen provided an update on Contrave. The company, which had received a complete response letter (CRL) from the US Food and Drug Administration (FDA) in Jan 2011 for Contrave, is planning to resubmit the new drug application (NDA) in 2013. Orexigen is hopeful of gaining approval in early 2014.

At the time of issuing the CRL, the FDA had expressed concerns regarding the long-term cardiovascular safety profile of Contrave and had asked Orexigen to conduct an additional study. The FDA requested a randomized, double-blind, placebo-controlled trial of sufficient size and duration which would show that the risk of major adverse cardiovascular events in overweight and obese subjects treated with Contrave does not adversely affect its benefit-risk profile.

In Jan 2013, the company said that the Division of Metabolism and Endocrinology Products (DMEP) has proposed a resubmission procedure under which an interim analysis report submitted by the independent Data Monitoring Committee of the Light Study can be used for the resubmission of the Contrave NDA.

We note that Contrave, once launched, will be a late entrant in the obesity market. Last year, two obesity prevention drugs were approved: Arena Pharmaceuticals, Inc.’s (ARNA - Snapshot Report) Belviq and Vivus Inc.’s (VVUS - Snapshot Report) Qsymia.

Orexigen carries a Zacks Rank #2 (Buy). Currently, Cytokinetics, Incorporated (CYTK - Snapshot Report) carrying a Zacks Rank #1 (Strong Buy) looks more attractive in the pharma sector.

Please login to Zacks.com or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research

Close

Are you a new Zacks Member or a visitor to Zacks.com?

Top Zacks Features

Learn more

Start for as little as $4.50 per trade.

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Zacks.com. Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
DIXIE GRP IN DXYN 15.84 +7.90%
BOFI HLDG IN BOFI 85.30 +4.97%
RAMBUS INC RMBS 12.31 +4.41%
VIPSHOP HOLD VIPS 148.73 +4.35%
NETFLIX INC NFLX 345.74 +4.32%