With only a couple of weeks to go before the most important annual meeting in the company's history, Vivus (VVUS) is showing some traction with its prescription numbers for anti-obesity drug Qsymia. For last week, IMS Health reported that prescriptions filled for Qsymia were 4,985. This is markedly better than the roughly 3,000 scripts per week the company was seeing for most of the first quarter. In fact, June seems to be shaping up to be the best month since launch for Qsymia. The company could approach 20,000 scripts on the IMS data. It is commonly thought that the IMS data under-reports by anywhere from 15% to 25%. Vivus reported that through March 31st, some 90,000 scripts had been filled for Qsymia since launch.
We've seen nearly 100% quarter-on-quarter growth between the fourth quarter of 2012 and the first quarter of 2013, and we're proud to say that since launch through the end of March of this year, we've generated nearly 90,000 prescriptions. We've got nearly 15,000 prescribers using the drug and we've had nearly 40,000 patients on the drug since launch.
The big question is whether or not the newly found traction will be enough, and what is driving that traction. Regarding traction, on one hand, the relaxed REMS regarding qualified pharmacies may be a help, and that program is expected to take a few more weeks to finish rolling out. On the other hand, the launch of a competitors drug, Arena's (ARNA) Belviq, has actually brought additional consumer focus to Vivus as well as obesity. The Google trends on the drugs are quite interesting, and I covered the subject in an article titled, Weekly Trends For Arena Pharmaceuticals and Vivius Obesity Products. If you look in the chart you will see that Vivus has experienced a spike of its own on the heels of the Arena launch of Belviq, and not only that, regained its top spot in web searches vs. the competitor within days of launch. The other item that could be driving sales is the fact that the American Medical Association just recently voted to classify obestity as a disease.
On the subject of whether or not the newfound traction will be enough, things get more complex. Through the last quarterly report the revenue from sales of Qsymia had been quite modest, launching a new drug is not easy. It is even more difficult when you doing it without a marketing partner. Add in REMS that limit how you can market the drug and it makes an already difficult road even harder. To its credit, Vivus has seemed to find a second wind of sorts, and while it may sound contrary to logical thinking, the launch of Arena's Belviq may actually help Qsymia sales (Arena had IMS script numbers of lust under 1,100 in launch week). The AMA classification labeling obesity as a disease is also a shot in the arm. If Vivus can clear 20,000 scripts per month it could build a decent base that could show some light at the end of the tunnel.
Vivus is in a challenging time. Activist shareholder First Manhattan has been critical of the current Board of Directors and management. First Manhattan has gone so far as to present a proxy challenge and nominate an entirely new board slate. The annual meeting is only weeks away. In my opinion, Vivus has had its hands full in fighting off a challenge, getting sales numbers up, and getting ready for the launch of a competitor with a big pharma partner in Eisai.
Personally, I do not see the efforts of First Manhattan as being successful. What I do see happening is that Vivus has been holding back what appears to be some positive sales numbers over the last couple of months. I feel that there is a great potential that the company could put out some big news over the next two weeks in an effort to defend themselves from First Manhattan.
For the savvy investor there could be some interesting trading plays in the next two weeks. The scenario is quite tempting. I can see a 10% pop happening at some point along the way. That is the short term. The longer term will be driven by traction in sales and maximizing revenue. Stay Tuned.
Additional disclosure: I have no position in Vivus.