VIVUS Seeks to Expand Market Reach
The obesity drug is currently only available through mail-order pharmacies, including Express Scripts, CVS Caremark (NYS: CVS) , Walgreen (NYS: WAG) , and Kaiser Permanente. As part of the approval process, the Risk Evaluation and Mitigation Strategy established the restriction to make sure patients and their doctors understand the potential for birth defects if the drug is used by pregnant women.
After the approval, though, VIVUS said the Food and Drug Administration was open to expanding access to the drug through retail outlets. It isn't clear to me if the FDA had a change of heart during the approval process or if VIVUS was too conservative with its initial REMS proposal.
Either way, VIVUS is following the FDA's advice and submitted a revised REMS to include sales through select retail pharmacies. CVS and Walgreen would seem to be logical choices since they already have the mechanism in place to transmit the required information about prescriptions back to VIVUS.
Ordering drugs through the mail isn't the biggest barrier to entry, but it does require different steps compared with going into the local pharmacy to get the drug. Under the current distribution system, I imagine there will be at least a few prescriptions that go unfilled because the patients weren't willing to jump through the hoops, however unobtrusive they are. Abandoned prescriptions are, in general, a big problem for the industry, so reducing barriers to access should help.
The ability to get the drug from retail pharmacies might also make prescribing the drug easier on doctors' offices since they won't have to hold patients hands through the process. With imminent competition from Arena Pharmaceuticals' (NAS: ARNA) Belviq, anything to easy burden on doctors will be an added plus.
Investors have to keep this expanded access in context, though. The difference between mail order and retail pharmacies pales in comparison to the difference between a patient paying for the drug themselves -- at more than $120 per month -- and having the drug covered by insurance. Getting insurance companies to cover Qsymia is still the limiting factor in getting to blockbuster status in my opinion.
Even if VIVUS can get Qsymia into retail pharmacies, it could still face competition from Arena Pharmaceuticals and its own obesity drug, Belviq. Get an in-depth look at the industry dynamics with our brand new premium research report on Arena Pharmaceuticals. We walk investors through the must-know opportunities and threats facing Arena. Since key news can develop quickly, we're also including a full year of updates for those who sign up. Click here now to learn more.
The article VIVUS Seeks to Expand Market Reach originally appeared on Fool.com.Fool contributor Brian Orelli has no positions in the stocks mentioned above. The Motley Fool owns shares of Express Scripts. Motley Fool newsletter services recommend Express Scripts. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.