- Associated Press - Thursday, July 15, 2010

GAITHERSBURG, MD. (AP) - A panel of federal health experts dealt a surprising setback Thursday to a highly anticipated anti-obesity pill from Vivus Inc., saying the drug’s side effects outweigh its ability to help patients lose weight.

The Food and Drug Administration panel voted 10-6 against Vivus’s Qnexa, citing uncertainty about the potential risks that could come with long-term use of the drug. The FDA will consider the panel’s ruling and make its own decision on the drug in coming months.

Panelists unanimously agreed the drug helps patients lose pounds, with most reporting more than 10 percent weight loss. But those benefits were outweighed by a slew of safety concerns that cropped up in company trials, including memory lapses, suicidal thoughts, heart palpitations and birth defects.

“Some of these side effects are serious and could be life-threatening and must be weighed against a relatively modest weight loss,” said the panel’s chair, Kenneth Burman of the Washington Hospital Center.

The vote deals a major blow to the Mountainview, Calif., drugmaker, which is racing to market the first new U.S. prescription weight loss drug in over a decade.

The company said in a statement it was disappointed by the panel’s vote and would continue working with the FDA. The agency is scheduled to make a decision on the drug before Oct. 28.

The negative opinion also suggests a higher bar for the company’s two California competitors _ Arena Pharmaceuticals and Orexigen Therapeutics Inc. _ which are schedule to have their own weight-loss pills reviewed later this year.

Shares of Vivus were halted ahead of the meeting, but the outcome is sure to sink the company’s stock price, which has doubled over the past year on high expectations for the drug. The stock closed at $12.11 on Wednesday.

Shares of Arena Pharmaceuticals rose 8 percent to $4.25 in after-hours trading, extending earlier gains from a positive medical journal review of the company’s drug lorcaserin.

Orexigen Therapeutics fell 10 percent to $4.50 in extended trading on a tougher approval outlook for the company’s drug Contrave.

“From my point of view, I think this makes it a very risky environment for everyone,” said Wedbush analyst Michael King. “I just think it’s going to be very difficult for either lorcaserin or Contrave to get through.”

King said it was unclear whether Qnexa would ever win approval, especially if the FDA requires additional clinical trials, which can take millions of dollars and years to complete.

With U.S. obesity rates nearing 35 percent of the adult population, doctors and patients say new pharmaceutical treatments are needed. And Wall Street analysts say even a modestly effective drug has blockbuster potential.

Qnexa has shown the best weight loss results of the three drugs, but it also had the highest rate of patient dropouts due to the side effects.

Several panelists said they wanted to vote in favor of the drug, but needed more information about its long-term effects on the heart. Qnexa only tracked patients for about a year.

Story Continues →