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Last year may have been a year of losses for obesity-fighting drug developers Arena Pharmaceuticals (NASDAQ:ARNA), Vivus (NASDAQ:VVUS), and Orexigen Therapeutics (NASDAQ:OREX), but 2012 has already been a year for gains. Stock prices soared for all three companies in the past 12 months: 400 percent for Arena and 200 percent for each Vivus and Orexigen. These monster gains came from the approaching launch of new weight-loss drugs from each manufacturer.
Arena’s weight-loss pill Belviq became the first obesity drug approved by the Federal Drug Administration since Xenical in 1999. Its approval changed the fortunes for the entire obesity drug market, raising stock prices for Vivus who received FDA approval for a new drug Qsymia in July and Orexigen whose new drug Contrave is still in the testing stage.
Although obesity presents an ever growing problem to modern medicine, with 35 percent of Americans considered obese, the approval of weight-loss drugs has not been growing easier. Since many patients take these drugs for an extended period of time, all three of companies had significant regulatory hurdles in developing their drugs, and each one of the three drugs was rejected at one time by the FDA.
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Belviq, which Arena’s marketing partner hopes to release by late 2012 or early 2013, consists of an entirely new chemical entity, and was cleared for use in chronic weight management in adult patients with an initial body mass index of 30 or greater and for patients with at least one weight related medical condition.
“The approval of this drug, used responsibly in combination with a healthy diet and lifestyle, provides a treatment option for Americans who are obese or are overweight,” said Director of the FDA’s center for drug evaluation and review Dr. Janet Woodcock, in a statement regarding Belviq.
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Both Oreigen’s Contrave and Vivus’ Qsymia combine two well-established drugs already approved by the FDA. Contrave contains low doses of naltrexone, an opiate antagonist, and bupropion, used to treat depression, and Qsymia contains phentermine, a stimulant and appetite suppressant, and topiramate, used to treat epilepsy.
Within three years, barring any further complications, all three drugs will be on the market. Qsymia is expected to launch by late this year, as is Belviq, while Contrave is expected by mid to late 2014. Those are some nice catalysts for business if you are a current or prospective shareholder.
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