Vivus (VVUS) officially named a new Chairman of the Board and CEO today. The management shake-up comes after a hotly contested proxy battle that ended with a compromise settlement where First Manhattan gained a controlling majority on the Board of Directors as well as bringing in a hand-picked CEO, Tony Zook.
The new Chairman of Vivus is Michael Astrue. Astrue formerly served as Chief Executive Officer of Transkaryotic Therapies, was Chairman of the Massachusetts Biotechnology Council, and Commissioner of Social Security. The new CEO Tony Zook formerly served as Executive Vice President, Global Commercial Operations for AstraZeneca and President of Medimmune.
Vivus investors had witnessed the once promising anti-obesity drug Qsymia languish after a launch last Fall, hampered by REM's restrictions and perhaps management decisions that seems to stagnate sales. The new management and board of Vivus have a lot to do to regain the confidence of investors. Chairman Michael Asture promises that the company will move quickly on four key areas.
Mr. Astrue said, "We intend to move quickly on our four main goals: 1) expand use of Qsymia through targeted patient and physician education; 2) find the right partner for Qsymia; 3) quickly create a pathway for approval in Europe; and 4) eliminate expenses that are not essential to expanding use of Qsymia. We are thrilled to have an executive of Tony Zook's caliber already pushing hard on these four goals."
Indeed, the company does have to act quickly. Competitor Arena Pharmaceuticals (ARNA) recently launched an anti-obesity drug of its own called Belviq. Arena's sales pace at launch was better than Vivus', but as yet the newer drug to the market has not surpassed Qsymia in weekly channel check sales figures. The gap is closing quickly though.
Over the past 3 weeks Qsymia investors may have seen some hope in apparent added traction on sales. Weekly scripts went from 5,100 to 6,100 and the 7,100 in quick succession. This is likely attributable to the recently loosened REMs that made Qsymia available in certified pharmacies for the first time.
One of the stated goals that the new board of directors has laid out is finding a partner for Qsymia. This may not be an easy task. Arena is partnered with Eisai on Belviq, and Orexigen (OREX) is in FDA trials for an anti-obesity drug of its own. Essentially, potential partners may want to see more traction in the prescription anti-obesity sector before partnering up.
Another stated goal was to quickly create a pathway for approval in Europe. This is another challenging goal. Vivus has already seen a rejection in Europe as well as a failed appeal of that decision. Competitor Arena pulled its application because it would not be able to answer or address concerns in a timely enough fashion to avoid rejection. Europe will not be easy for either drug, and many thought that Arena had a better chance of success.
It will be interesting to see how much patience Vivus investors have in the coming months. There has been a lot to endure with scant information from which to estimate the size and scope of the prescription anti-obesity space, which once had "blockbuster" attached to it. Stay tuned.
Additional disclosure: I have no position in Vivus or Orexigen.