After a surprisingly positive panel hearing yesterday the big question remaining for Vivus (NASDAQ:VVUS) is whether the FDA will allow Qnexa on the market before a cardiovascular safety study has been completed.
Many investors are already betting on approval by the obesity drug’s April 17 PDUFA date – shares in the California company almost doubled in value in early trading today to $20.21. The panel of experts that voted 20 to 2 in favour of allowing the drug on the market certainly seemed to favour a post-marketing study. Whether the FDA shares that conviction is another matter entirely; averting another safety scare will be the agency’s prime motivation and could still prompt a conservative decision.
The strong endorsement of approval yesterday surprised even those who expected the votes to fall in favour of allowing the drug on the market. Widespread backing of the drug from a very large panel of experts certainly suggests the regulator should also be able to appreciate Qnexa’s benefits, despite known and unknown risks.
A cardiovascular safety trial to quantify any risk is almost certainly going to be demanded and Vivus has already proposed such a study. Unfortunately, the panel were not explicitly asked to vote on whether this should be a pre-approval requirement.
Comments made throughout the day suggest many of the panel would be comfortable for that to happen following approval and the almost emphatic support for a marketing license also points to confidence in the product’s safety profile.
Translating all that into what the regulator might demand is not so simple, however. Despite the urgent need to address the obesity problem in the US the implications of another safety scare and drug withdrawal would be huge for the FDA. This will be an incredibly challenging judgement for the regulator to make, and one that is very hard to call.
It was the cardiovascular safety of Qnexa that dominated the panel hearing yesterday and the issue that will determine how quickly the product gets to market. The drug’s association with birth defects was also an issue, but concerns seem likely to be overcome with a REMS to restrict its use. The implications of the REMS for the product’s commercial potential will be another issue for the future.
The panel were particularly concerned about the increased heart rate seen in patients taking Qnexa; this was despite the fact that the drug improved other important readings including blood pressure and blood sugar levels. Vivus is proposing an 11,000 patient trial to measure major adverse cardiac events that would take up to five years. By running such a large trial the company hopes to prove the drug actually reduces the risk of these events, as well as establishing its heart safety.
Another panel due to take place at the end of March will discuss cardiovascular issues for obesity treatments. Again that hearing will help gauge experts in the field’s attitude to the risks and benefits of such drugs, but will provide little clarity on the FDA’s thinking.
Shortening the path?
Qnexa’s chance of reaching the market has undoubtedly improved substantially. Whether it will happen this year as the company’s share price implies is less certain. Even if the FDA agrees to a post-marketing study, it could still ask for it to be substantially underway as a condition of approval.
Of course Vivus shares are not just soaring on hopes for approval. Obesity is huge untapped market and the first FDA approved therapy for more than a decade represents a valuable proposition. It seems unlikely a big partner would be willing to commit a big upfront ahead of the final FDA decision and Vivus will no doubt be tempted to hold its nerve, and seek a bigger prize if all goes well.
Shares in other obesity hopefuls Orexigen and Arena also rose today, 19% and 8% respectively, as the path to market for these agents appeared clearer. Whether the path will get any shorter is less certain.