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By Michael Fitzhugh

The U.S. Food and Drug Administration’s rejection of Arena’s (NASDAQ:ARNA) experimental obesity drug lorcaserin now shifts public attention to two other contenders set to come before the agency for review. Investors looking to cash in on a largely untapped market opportunity are left with thinning expectations for success.

Obesity treatments could be worth $11 billion by 2018 in the world’s seven top markets, says Datamonitor. Even a more modest evaluation put forth by Vivus (NASDAQ:VVUS), developer of the next obesity drug slated for review, Qnexa, pegs the current global market for obesity drugs at an attractive $5 billion annually.

Nevertheless, recent events show just how tough it can be to reach that golden market—and maintain access to it. The lorcaserin rejection was due in part to a limited efficacy. Vivus has shown strong results in that category, illustrating that 40 percent of patients taking Qnexa achieved a weight loss of greater than 15 percent. But it still needs to overcome a negative July vote cast by the FDA’s Endocrinologic and Metabolic Drugs Advisory Committee, which recommended against approving the drug because of lack of long-term safety data. Since then, Vivus has provided additional data to the FDA. The agency is expected to render its decision on Qnexa October 28.

The recent withdrawal of Abbot’s (NYSE:ABT) Meridia in the United States and Europe due to cardiovascular safety concerns could also weigh on both Qnexa and Orexigen’s (NASDAQ:OREX) Contrave, the other experimental obesity medicine under consideration by the FDA. Because both have systemic effects like Meridia, regulators may pay extra attention to safety data or demand additional information before approval.

Finally, the potentially rapid uptake of both drugs is likely to add a dose of caution to the FDA review. If either drug is as successful as investors hope, it could be used by millions of people in the United States.

Source: Slim Hopes for Obesity Drugs to Gain Approval