Orexigen Therapeutics, Inc. (OREX - Free Report) announced that the U.S. Food and Drug Administration (FDA) is expected to render a decision on obesity candidate, Contrave, by Jun 10, 2014. The stock gained 2.7% on the news.
Orexigen had resubmitted the new drug application (NDA) for Contrave to the FDA in Dec 2013. The company had received a complete response letter (CRL) from the FDA in Jan 2011. 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 regulatory application was submitted on the basis of an encouraging summary report by the independent Data Monitoring Committee on the Light Study. The interim analysis of the clinical study report (CSR) will be submitted to the FDA by mid-February.
We note that the randomized, double-blind, placebo-controlled Light Study (n = 8,900) is underway to assess the risk of major adverse cardiovascular events in overweight and obese patients treated with Contrave. The study is being conducted under the FDA’s Special Protocol Assessment program.
Contrave is also under regulatory review in the EU with a final decision expected in the second half of 2014. Orexigen expects the interim analysis data from the Light Study to equip the company to answer the Committee for Medicinal Products for Human Use Day 120 List of Questions.
We note that the company has a collaboration agreement with Takeda for the development and commercialization of Contrave in North America. Takeda has experience in the metabolic disorder market, which should be beneficial. The companies are planning to launch Contrave, if approved, in the U.S. in the second half of 2014.
It is likely that Contrave will be approved both in the U.S. and EU given the positive data from the Light Study. This will also help Orexigen secure a lucrative partnership for Contrave in the ex-North American region in 2014.
However, we note that Contrave, once launched, will be a late entrant in the obesity market. Last year, two obesity drugs – Arena Pharmaceuticals Inc. (ARNA - Free Report) and Eisai Inc.'s Belviq and VIVUS Inc.’s (VVUS - Free Report) Qsymia – were approved.
Orexigen carries a Zacks Rank #3 (Hold). Some better-ranked stocks include Gentium carrying a Zacks Rank #1 (Strong Buy).