This Investment Just Became More Attractive: VIVUS, Inc. (VVUS), Arena Pharmaceuticals, Inc. (ARNA)

European Approval

The European Medicines Agency’s (EMA) Committee for Medicinal Products for Human Use (CHMP) has also confirmed its earlier decision of not granting an MAA (Marketing Authorization Application) to Qsiva (phentermine/topiramate ER). The company had filed a review with the governing body, but it has been refused on the basis of potential cardiovascular risks Qsiva might pose. The CHMP has asked for a pre-approval cardiovascular outcomes trial for Qsiva to establish the long term safety of the product. I believe the product will eventually receive the European approval, and this update places it one step close to that eventuality.

Price

In more recent news Vivus has further reduced the price tag on its Qsymia. This can mean more troubles to Arena Pharmaceuticals, Inc. (NASDAQ:ARNA) investors because Arena Pharmaceuticals, Inc. (NASDAQ:ARNA) has already priced Belviq at $199 for a months supply. VIVUS, Inc. (NASDAQ:VVUS) has launched a new ‘Save Now’ program which it operates directly through its website. According to disclosed information, the drug is now available to customers at only $75, savings of a mammoth $85 dollars. This now makes Belviq almost three times as expensive as Qsymia. Arena might not find it that easy to slash off price because it is launching the drug with a partner that will take a 33% cut from wholesale receipts.

Bottom line

The company has shown hopeful data for Qsymia, but there is still a long road ahead. To make it a blockbuster the distribution channel limitations will have to be lifted. The recently launched trial system was a good step, and more such programs will increase awareness amongst consumers of the potential of VIVUS, Inc. (NASDAQ:VVUS). The success rate of 70% is pretty impressive and is a testament to the commercial potential of the drug. Insurance coverage remains the key to the success of Qsymia, which is priced at $160 per month. In more good news for investors, Aetna and Express Scripts have agreed to cover Qsymia, and there are rumors that more coverage is on its way. I believe this price decline on earnings is a good opportunity for prospective investors to get in because share prices should rebound on coverage news and the future sales potential of Qsymia. Belviq is due to be launched in US and will enjoy a much better sales channel. The safer profile of Belviq might give it an initial sales edge over Qsymia in the short run.

The article This Investment Just Became More Attractive originally appeared on Fool.com and is written by Mohsin Saeed.

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