Orexigen Shares Jump on NDA Submission for Weight Loss Drug

Orexigen Therapeutics, Inc. (OREX) and Takeda Pharmaceuticals are hoping that the re-submission of a New Drug Application for a weight loss drug to the U.S. Food and Drug Administration will work out similar to that of applications by Vivus, Inc. (VVUS) and Arena Pharmaceuticals Inc. (ARNA) earlier this year. 

Orexigen said Monday morning that it will resubmit its NDA for Contrave in the next few weeks to the FDA and hopes to have an approval by June 2014.  Takeda, an international biotechnology company headquartered in Japan, is Orexigen’s partner for Contrave in North America.

Contrave is a pill that combines anti-addition drug naltrexone with bupropion, the active ingredient in the popular antidepressant drug Wellbutrin.

The FDA rejected Orexigen’s first shot at marketing approval for Contrave in February 2011, saying that it wants to see data from a longer-term study to prove that Contrave doesn’t elevate risks for a heart attack.  At that time, Contrave was the frontrunner to become the first weight loss pill approved by the FDA since Roche’s (RHHBY) Xenical in 1999.  The rejection also came as a bit of a surprise because a FDA advisory panel had voted 13-7 in favor of approval of Contrave two months earlier.

The regulatory agency, which had taken a decade-long extremely conservative approach to approving diet pills because of associated health problems and deaths, had also recently turned-down Arena’s Belviq and Vivus’s Qsymia for marketing approval.  After some further investigative studies and resubmission of NDA’s, both drug garnered FDA approval.

Orexigen says that through extra research in what it calls the “Light Study,” it has compiled the additional information that the FDA required showing no additional risk of a cardiovascular event for patients taking Contrave as compared to the control arm and they think the drug should be approved, based upon an interim analysis of the data.  Orexigen noted that the FDA previously agreed that if the interim analysis meets the specified criteria to exclude cardiovascular risk, Contrave could be approved.

Michael Narachi, chief executive of Orexigen, said in a statement this morning, "The resubmission will contain an unprecedented amount of cardiovascular outcomes data for an obesity therapeutic, and we are confident these data will support a favorable benefit:risk assessment for Contrave."

Contrave would be the first FDA-approved drug for Orexigen.  The company also filed for European Union approval of Contrave in October.  When the FDA rejected the NDA in 2011, shares lost virtually all of their value over subsequent months, sinking from near $10 per share to lows in August 2011 at $1.22.  The stock has climbed back north, hitting a pre-rejection high of $7.84 in August.  Shares closed Friday at $5.68 and have jumped ahead about 10 percent in Monday morning action to $6.25.