I have recently began focusing a bit of my time and energy on Vivus (VVUS) and Arena (ARNA). A central focus for both companies right now are weight loss drugs that carry substantial promise. Both companies received FDA approvals and are moving forward in their respective efforts to bring Qsymia and Belviq to market.
In looking at these companies one can not help but notice that Arena seems to be hinging quite a bit on the success of Belviq, while Vivus has some another drug in the pipeline that also has FDA approval and is getting ready to go to market.
In some ways a bit of diversification in a company can be a wonderful thing. It provides a bit of latitude, and as one product begins to deliver revenue, it can help launch another.
The second Vivus is getting ready to launch is Stendra, a drug for erectile dysfunction. While it is certainly not the only drug available for this condition, there seems to be plenty of room for another to make it to the marketplace.
The stage at which Stendra is allows Vivus to carry forward a two pronged approach that builds a bit of safety into its business strategy. For Vivus, the timing could perhaps not be better. Getting two drugs to market that deal with two big problems faced by people could be a recipe for not necessarily guaranteeing success, but at least improving the odds. With U.S. approval of both Stendra and Qsymia under its belt, the company is planning on European expansion.
"Our drug, STENDRA TM, or avanafil, was approved by the FDA on April 27, 2012, for the treatment of erectile dysfunction, or ED, in the United States. As part of the approval of STENDRA, we are committed to conduct post-marketing studies. In March 2012, we filed an MAA with the EMA to market avanafil in the EU for the treatment of ED. The approved trade name for STENDRA in the EU is SPEDRA TM. In July 2012, we received the Day 120 List of Questions from the EMA. We are currently reviewing the Day 120 List of Questions which covers a broad range of topics including, without limitation, questions relating to clinical relevance in certain populations as well as questions regarding drug-drug interaction and pharmacokinetics. We are in the process of preparing our response to the CHMP. Avanafil is an oral PDE5 inhibitor that we license from Mitsubishi Tanabe Pharma Corporation, or MTPC. We intend to market and sell STENDRA in the United States and, if approved, SPEDRA in the EU and other territories outside the United States through collaboration with third parties. We are currently in discussions with potential collaboration partners for all stated territories."
This two pronged approach is simple, and keeping things simple is good. The company outlines its strategy in a way even a rookie investor can understand:
Vivus's goal is to build a successful biopharmaceutical company through the development and commercialization of innovative proprietary drugs. Vivus intends to achieve this by:
Successfully launching Qsymia in the United States;
- Entering into and supporting a collaboration agreement for the commercialization of STENDRA for the treatment of ED in the U.S.;
- Obtaining regulatory approval for Qsiva (The EU version of Qsymia) for the treatment of obesity and SPEDRA (The EU version of Stendra) for the treatment of ED in the EU and other territories worldwide; and
- If approved, entering into and supporting collaboration agreements for the commercialization of Qsiva for the treatment of obesity and SPEDRA for the treatment of ED in the EU and other territories worldwide.
Simpy stated, the success of Vivus does not rest solely on the shoulders of Qsymia. Stendra is a viable product that can help deliver financial results as well as those that people would seek a prescription for.
There will certainly be competition along the way for Vivus, but the market is big (no pun intended) in both weight loss and erectile dysfunction. While Qsymia gets most of the headlines, don't discount the impact Stendra can have.
Disclosure: I am long ARNA.
Additional disclosure: I have no position in VVUS.