Orexigen's Obesity Drug Mysimba Gains European Approval - Analyst Blog

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Orexigen Therapeutics, Inc.’s OREX obesity drug, Mysimba (U.S trade name: Contrave), gained approval in the EU as an adjunct to a reduced-calorie diet and increased physical activity for weight management in obese (Body Mass Index, or BMI, ≥ 30) or overweight (27≤BMI< 30) adults suffering from at least one or more weight-related co-morbid condition including type II diabetes, dyslipidemia or controlled hypertension.

EU approval was largely expected as the Committee for Medicinal Products for Human Use (CHMP) had issued a favorable opinion last December.

However, Mysimba’s approval in the EU comes with special warnings related to increased risk of suicidal thoughts and behavior associated with antidepressants like bupropion, which is an active substance in the drug. The EC also stated that patients receiving Mysimba should be evaluated after 16 weeks and the drug should be discontinued in those patients who have failed to lose at least 5% of their initial body weight.

We note that Contrave was approved in the U.S. in Sep 2014. Orexigen has a collaboration with Takeda Pharmaceutical Company Ltd TKPYY for Contrave in North America. As per Takeda, U.S. net sales of Contrave in the fourth quarter were $6.5 million since its launch in Oct 2014. Though initial Contrave sales have been encouraging, we note that the obesity market already has products like Qsymia and Belviq.

Meanwhile, the obesity market is getting more crowded – Novo Nordisk’s NVO Saxenda, which gained FDA approval in Dec 2014 gained EU approval a few days back. Several health care companies are looking to bring obesity treatments to the market.

Orexigen currently carries a Zacks Rank #4 (Sell). Some better-ranked stocks in the health care sector include Acorda Therapeutics, Inc. ACOR, Takeda and Novo Nordisk. While Acorda is a Zacks Rank #1 (Strong Buy) stock, Takeda and Novo Nordisk hold a Zacks Rank #2 (Buy).


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