The Good News, Bad News for Belviq: ...Now the Good News

The Good News, Bad News for Belviq: ...Now the Good News

Belviq, Arena Pharmaceuticals' (NASDAQ: ARNA) lead obesity drug, continues to rack up mediocre sales numbers as sales performance continues to lag expectations. Fans of Belviq and Arena still see the drug as a potential blockbuster but questions remain as to how Belviq can still meet lofty pre-launch predictions.

In an earlier article, I noted that Belviq will likely need more time to fit into accepted standards of care and many physicians will simply need more exposure to Belviq before they feel comfortable exposing obesity patients to a new drug. In the meantime, physicians will still rely overwhelmingly on tried-and-true approaches including diet and exercise.

That being said, there is ample good news for Belviq into the mid-to-long term. Arena and marketing partner Eisai (NASDAQOTH: ESALY) remain confident in Belviq's potential and have recently moved to up marketing efforts significantly. Furthermore, physicians will likely warm up over time to a new medication option in an area that is short on decent drugs.

A much needed pep talk
Recent actions on the part of Arena and Eisai seem to indicate that there is a renewed effort to overcome some of the barriers Belviq has faced since June. In particular, Eisai recently announced intentions to double Belviq's sales force by December.

Given that many physicians still need convincing before they switch patients to a new and unfamiliar medication, this can only be seen as a good thing. Additionally, Belviq's label still carries warnings against rare but potentially fatal heart valve and neurological side effects -- increased outreach to physicians would likely go a long way to lessen fears surrounding its safety.

As part of the bigger picture, Arena and Eisai also recently initiated an agreement giving Arena and Belviq channels into markets around the world. It appears Belviq will get more than a few chances to make a splash within the obesity market at a time when obesity is becoming a growing problem in more countries

As an added bonus, agreements between Arena and Eisai include big potential milestone payments based on sales, development, and regulatory progress. However, the maximum cumulative payout of $1.56 billion may require time and borderline transformational results from Belviq to obtain.

A rose among thorns
While Arena and Eisai undertake renewed efforts to better market Belviq, the current landscape of lackluster "old guard" options may have already done investors a few favors. Outside of the newest generation of weight loss medications, including Belviq and VIVUS Therapeutics' (NASDAQ: VVUS) Qsymia, the cast of existing weight loss medications is pretty shaky.

While relatively effective, familiar weight loss drugs like orlistat, sold as Xenical by Roche (NASDAQOTH: RHHBY) and over-the-counter as Alli by GlaxoSmithKline (NYSE: GSK), and generically available phentermine both suffer from their own major issues.

Phentermine, an appetite suppressant that acts on the brain, has a number of well-documented side effects that makes it dangerous for many patients. This is especially true for patients with cardiovascular problems including stroke, heart rhythm trouble, and high blood pressure (all problems common among the obese) as phentermine is well known as a medication that causes significant cardiovascular problems on its own.

Additionally, phentermine is regulated as a controlled substance -- a distinction that comes tied with all sorts of storage, monitoring, and prescription strings.

Similarly, orlistat, a medication that prevents absorption of fat, can cause notoriously severe diarrhea and stomach upset in many of its patients.

For Belviq, which has a relatively cleaner safety profile even when compared to fellow newcomer Qsymia, the field looks favorable as more patients are turned on to its potential as a less hasslesome drug option.

The waiting game
I still think it's too early to say if investors should reconsider the sky-high expectations of the Belviq pre-launch estimations, but I do believe that Belviq needs more time to gain traction than Arena investors are willing to admit.

Like most new drug products, new prescriptions are everything for Belviq which means getting physicians to write those new prescriptions for their patients. Even milestone payments, no matter how generous on, ultimately rely on getting Belviq closer to patients. While this is harder said than done, especially in a finicky area like obesity treatment, I believe that Arena at least has many of the right pieces in the right places.

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