Arena Pharmaceuticals, Inc. (ARNA): Why This Obesity Drug Is the Sector’s Best Bet

Competitive landscape

VIVUS, Inc. (NASDAQ:VVUS) remains Arena Pharmaceuticals, Inc. (NASDAQ:ARNA)’s only real competitor in obesity treatments, because the third obesity pill, Contrave, is still undergoing extensive cardiovascular trials. The initial sales data for Qsymia was pretty disappointing, but VIVUS, Inc. (NASDAQ:VVUS) has since then used massive discounts and other innovative sales tactics to drive up demand.

The ‘Get Started’ program offers 14 days of free Qsymia to prospective clients. The ‘Save Now’ program allows users to buy the first 30 days of drug for a low price of $75. The investing community is hoping that Qsymia sales will improve due to the recent removal of its distribution restriction. Where it was once only available via mail order, patients can now also get the drug through specialty pharmacies.

The sales data of Qsymia and Belviq will give Orexigen Therapeutics, Inc. (NASDAQ:OREX) a better assessment of Contrave’s commercialization obstacles. The drug has failed to receive the FDA approval and is still undergoing an extensive cardiovascular trial. The governing body asked for a reassessment of Contrave’s impact on patients’ hearts, and the cardiovascular risks it might pose.

The bottom line

Belviq’s approval will be a major catalyst for all three leading players in the industry. Its better safety profile makes it the best candidate to succeed in the obesity industry, and solid sales data could seriously move its parent company’s share price. Arena Pharmaceuticals, Inc. (NASDAQ:ARNA) will enjoy Eisai’s experience in marketing the drug to U.S. patients, and extensive distribution thanks to its favorable DEA review. This is a perfect opportunity for investors to look closer at Arena; its shares could keep appreciating as we move closer to the launch date.

The article Why This Obesity Drug Is the Sector’s Best Bet originally appeared on Fool.com.

Mohsin is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.

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