Arena Pharmaceuticals, Inc. ARNA and partner Eisai Inc. ESALY announced that their New Drug Application (NDA) for an extended release formulation of Belviq (lorcaserin) has been accepted for review by the FDA.
Approval would provide patients with a chronic weight management treatment in a once-daily dosing option.
Belviq is currently approved as an adjunct to a reduced-calorie diet and increased physical activity for chronic weight management in adults who have a body mass index (BMI) of 30 kg/m2 or greater (obese), or BMI of 27 kg/m2 or greater (overweight) with at least one weight-related medical condition, such as high blood pressure, high cholesterol, or type II diabetes.
While there is significant unmet need in the obesity market, certain challenges remain in this market. These include the tendency of healthcare providers to treat symptoms of obesity rather than the disease itself, a narrow focus on certain patient types for treatment and historically low third-party insurance coverage.
In fact, on the third quarter earnings update, Eisai acknowledged challenges in the U.S. anti-obesity market. Arena said that Eisai expects slow growth in the obesity market in general with Belviq expected to continue to grow slowly until results from the cardiovascular outcomes trial (CVOT) are out and included in the product label, if positive. Results from the CVOT study are not expected until 2018.
Meanwhile, Arena announced a restructuring plan in late Oct 2015 to improve efficiencies and cut costs. The company said that it will remain focused on key R&D programs including the APD334 program (phase II study ongoing for ulcerative colitis, potential for additional indications beyond inflammatory bowel disease through small pilot studies), ralinepag (phase II study ongoing for pulmonary arterial hypertension (PAH), APD371 (in a multiple-ascending dose study with top-line results expected in the first quarter of 2016) and the Belviq CVOT – CAMELLIA.
The company plans to cut its U.S. workforce by 35% (approximately 80 employees). Arena expects this move to reduce annualized cash expenditures for personnel by about $11 million. The company intends to implement additional cost control measures like reductions at its Swiss manufacturing facility.
Arena is a Zacks Rank #2 (Buy) stock. Investor focus will remain on Arena’s upcoming “Analyst & Investor Day” on Dec 3. Some better-ranked stocks in the health care sector include Baxalta Inc. BXLT and Achillion Pharmaceuticals, Inc. ACHN. Both are Zacks Rank #1 (Strong Buy) stocks.
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