SOURCE: The Bedford Report

The Bedford Report

August 02, 2011 11:46 ET

All Hope Not Lost for Obesity Drug Makers

The Bedford Report Provides Equity Research on Arena Pharmaceuticals & Orexigen Therapeutics

NEW YORK, NY--(Marketwire - Aug 2, 2011) - In recent months the Food and Drug Administration (FDA) has crushed most of the hype surrounding the obesity drug market. While the FDA has argued that the potential risks in the current lot of obesity drug candidates are too high, drug developers believe the FDA is being unreasonable. The Bedford Report examines the outlook for companies in the biotechnology industry and provides stock research on Arena Pharmaceuticals, Inc. (NASDAQ: ARNA) and Orexigen Therapeutics, Inc. (NASDAQ: OREX). Access to the full company reports can be found at:

www.bedfordreport.com/ARNA

www.bedfordreport.com/OREX

Karen Riley, an FDA spokeswoman, says that the FDA "has always been clear with companies developing weight-loss products that we will weigh the drug's potential benefits with the potential risks."

Orexigen, whose drug candidate Contrave was rejected by the FDA earlier this year, recently met with regulators to gain clarity on what it needs to do to gain approval for the drug. Following the meeting Orexigen said that it believes that it would have to run a clinical trial with 60,000 to 100,000 patients to adequately show that the drug doesn't increase cardiovascular risk. As a result, Orexigen says it will halt US development of the diet pill.

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Orexigen said in a statement that it will appeal the FDA's decision. Although hope of Contrave being approved in the US appears slim, Orexigen says it may look at selling Contrave in international markets and pursue partnerships for new products with closely held companies.

Arena's obesity drug, Lorcaserin, was rejected last September after a memo from the FDA stated that the drug did not satisfy the mean efficacy requirements that the FDA has laid down for obesity therapies, and additionally caused tumors in rats. Arena plans to re-file its application by the end of 2011.

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