Arena obesity drug disappoints; shares fall
New York – Arena Pharmaceuticals shares fell 34 percent today after studies showed that its obesity drug provided less than stellar results. Apparently, patients taking the drug lost only ten more pounds than those taking placebos. The company is seeking U.S. approval of the drug called Lorcaserin, which it says meets the requirements by what it calls a “significantly favorable statistical margin.”
However, others are not so impressed. In a research note, JPMorgan said, “Although the results technically satisfy the FDA requirements for approvability, we consider the weight loss benefits to be underwhelming at best.”
The drug does not seem to cause any adverse side affects, after test patients underwent a two year treatment period. Of particular concern was the heart problems caused by “fen-phen” diet drugs, which were eventually recalled by Wyeth in 1997. Lorcaserin appears to successfully sidestep these issues.
Arena will complete another study in September, and the company hopes that the U.S. will approve the drug by the end of 2009. The future of Arena depends on whether the government approves the new drug and patients begin to use it.
