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Spencer Osborne

 
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  • Sales Of Arena's Belviq Close Out 2014 - What Will 2015 Bring? [View article]
    Jim.....

    People are waaaay to early in properly assessing refills on contrave. the first three weeks were essentially a wash due to supply hic-ups. I saw tooooons of people saying in the first three weeks of the Contrave launch that it was off to a terrible start and going nowhere.

    The Takeda launch strtaegy turns out to be the best one yet at gaining traction. Let's not short change that. The launch was such that it made Eisai rethink how it is doing business.

    The Belviq sample program is nowhere near as robust as some try to portray. Speak to a few reps, and get them out of the "sales" pitch. If you look at the numbers, you will see that the data in now way.....it is worth repeating......IN NO WAY....supports the concept that the sample program is very substantial. If it is, then people are simply not getting a refill after the freebie. If the sample program was substantial, we would be seeing a bigger influx in refills. The correlation is simply not in the data.

    Jan 9, 2015. 08:07 PM | 2 Likes Like |Link to Comment
  • Arena Investors Should Watch New Pricing Of Belviq Closely [View article]
    Jakes....

    Think of it this way....

    If you had an options to buy stock at $6.16 for years, what would your instructions be?

    Remember, you are sitting on underwater options for year.

    Your instructions would be as follows:

    1. Do not exercise these $6.16 options and make me lose money. The stock is only $3 and if I want 45,000 shares I can buy it cheaper on the open market.

    2. Exercise and sell these darn expensive options only if they get into the money. In fact, these have been under water sooooo long that the moment that the options get into the money, sell.

    If the news never happened, these would have expired worthless. the news did happen. It just so happened that the price went up above $6.16. What does the broker do.....sells according to his instructions.

    It is really that simple.
    Jan 9, 2015. 05:58 PM | 1 Like Like |Link to Comment
  • Arena Investors Should Watch New Pricing Of Belviq Closely [View article]
    Jakes...

    If the instructions were as I feel they were, there would be no good time. The exercise and sale would have happened on the first run no matter what the timing
    Jan 9, 2015. 05:26 PM | Likes Like |Link to Comment
  • Arena Investors Should Watch New Pricing Of Belviq Closely [View article]
    Jakes....

    A 10b5-1 plan leaves little room for changes. Essentially these executives get a lot of options as part of their compensation. They have to be able to sell at some point. A plan makes that happen, and was supposed to remove all of the smoke and mirrors.

    Some executives take a strategy of only selling enough to cover the expense and hold the shares. The Arena team does not seem to do a lot of this.

    The spector transaction is something i have little problem with
    Jan 9, 2015. 04:49 PM | Likes Like |Link to Comment
  • Arena Investors Should Watch New Pricing Of Belviq Closely [View article]
    Readers...

    I have had a few people reach out to me about the insider transaction. It seems that some think that the trade by Mr. Spector might be troublesome because it is "convienient" that the news that was delivered was enough to spike the stock price up to where the stock options actually have value.

    Spectors sales was under a 10b5-1 plan.

    This means that he outlined a set of instructions while not in possession of material information and left control of a buy or sell to another.

    If I were in Spectors shoes, and I had long held options on 45,000 shares at an exercise price of $6.16, I would tell my 10b5-1 broker to exercise these and sell only if they are in the money.

    Spector got these options beginning January 17, 2006 and they were vested upon grant and exercisable over the next 4 years. Essentially, had Spector wanted to, he could have exercised and sold these when Arena was up over $10. he never did.

    These option shares have been out of the money for quite some time. In about a week, they would have expired worthless. That being said, a prudent person is not going to leave these options alone without a plan in place.

    In my opinion Spectors instructions with regard to these under water options was simple.

    ' Exercise and sell only if they get into the money'

    That is exactly what transpired this week. The options got into the money and the broker did his duty.

    Spector made $4,500 in the transaction. In my opinion he was simply fortunate and nothing malicious was at play.
    Jan 9, 2015. 04:34 PM | 5 Likes Like |Link to Comment
  • Arena Investors Should Watch New Pricing Of Belviq Closely [View article]
    STS....

    The appropriate number is a tough call.

    With DTC advertising Eisia can create consumer pull. They likely can get away with fewer reps that with Contrave. Contrave is reliant on push at the moment.
    Jan 9, 2015. 03:08 PM | 1 Like Like |Link to Comment
  • Arena Investors Should Watch New Pricing Of Belviq Closely [View article]
    STS....

    Yes, this is a big subsidy. There is no question about it. Had sales been at higher levels indicating that consumers accepted a price point of about $140, then we would not be in this place. If insurance had stepped up beyond what it has, this point may have never been reached.

    Where we are is this. There is a sweet spot in what consumers are willing to pay out of pocket. I think Orexigen and Takeda found it, as it is clear they are getting patients in the door at a decent clip. Bottom line is that the price point is lower than many had hoped.

    IMO Eisai is not eating this adjustment. The deal calls for Arena to get 31.5% of net. Net will now go down. The question is if there will be enough volume to make up the delta.
    Jan 9, 2015. 03:05 PM | 3 Likes Like |Link to Comment
  • Arena Investors Should Watch New Pricing Of Belviq Closely [View article]
    Mourad...

    The price point is where it needed to get to. If the average person was on belviq for just two months, and 15 days of that is free, it was not seeing traction that is needed. There would be two reasons for that. First is that it is not working, and the second is price. We know that it works through substantial clinical trials.

    The way they lowered the price preserves the wholesale number at $199.50. This allows them to maximize the insurance side of things. Yes, they need to get better insurance and more importantly better tiers on insurance plans.

    The reps IMO was a concession. I think that they are using the savings from reps to offset cost of price cut. We will begin to know more with quarterlies
    Jan 9, 2015. 02:30 PM | 1 Like Like |Link to Comment
  • Arena Investors Should Watch New Pricing Of Belviq Closely [View article]
    investor....

    What we learned from the Contrave launch is essentially that price was a big hurdle. Some have known this for a long time, and some refused to believe it. IMO Orexigen and Takeda launched with a very solid plan. Initially it looked bad when the first numbers came out, but no-one can argue that the sales trajectory has been the most impressive to date. Eisai and Arena will now be applying a great deal of pressure to that model. This price point puts Belviq in the same ballpark as Contrave. That is very important
    Jan 9, 2015. 01:39 PM | 3 Likes Like |Link to Comment
  • Arena Investors Should Watch New Pricing Of Belviq Closely [View article]
    Sharon....

    Happy New Year!

    Agree. Wholesale price remains $199.50. I discussed the concept of price integrity with Dax and the importance of preserving the $199.50. There arte many reasons. Being able to maximize price of product, revenue, and other reasons

    That being said, the distributor will pay out $199.50, but then essentially get a rebate for the delta between wholesale and what the consumer paid.

    Eisai gets to claim higher revenue on one hand, but expenses go up on the other. For now, Belviq will be $75 or less (for those that use voucher).

    This can have a big impact on the net sales number (depending on how this is structured) and will likely have a big impact on Arena's average revenue per bottle.

    The concept is increasing sales volume by enough to offset the lost delta in the price point
    Jan 9, 2015. 01:36 PM | 2 Likes Like |Link to Comment
  • Arena Investors Should Watch New Pricing Of Belviq Closely [View article]
    STS....

    I was looking at net.

    Net was about $110. New net will likely be $75 or lower.

    RE Contrave.....

    We have very few stats on refills for Contrave. Refills are 4 weeks after script. The drug has about 13 weeks on market, and the first 3 were very low numbers because of glitches. Assessing refills is just now getting possible.
    Jan 9, 2015. 01:30 PM | 1 Like Like |Link to Comment
  • Arena Investors Should Watch New Pricing Of Belviq Closely [View article]
    dax....

    I suspect that the pricing will hit Arena.

    There is no reasonable way for Eisai to absorb all of the impact and have any motivation to sell this drug.

    In the past, the $75 cam off of the top to get to the net sales numer of about $110. The gross has always been $199.50 and the net has always been around $110. The $75 was the max rebate, but it could be less (depending on insurance).

    In my opinion Eisai came to a conclusion that a lower price point was needed and there was a discussion with partner Arena. No-one wanted to give up all the money. It could be that Eisai agreed to absorbing some cost in exchange for fewer reps. In other words, "we were going to pay $x to 150 reps, we will use that to offset the price decrease to that value and after that...."

    I am working on trying to get additional detail, but as yet have not been able to.
    Jan 9, 2015. 01:23 PM | 6 Likes Like |Link to Comment
  • Arena Investors Should Watch New Pricing Of Belviq Closely [View article]
    gazoo....

    As you are likely aware, I cover Arena more closely than the others.

    Specific to adverse events....

    1. The data is raw. It takes hours to comb through in order to correlate the adverse events to the number that were reported. I simply do not have the time, or inclination to spend additional hours on culling though Qsymia. I did give the number of events for Qsymia, as getting the amount of events is not as time consuming.

    2. I clearly state, and if you follow this sector you would be aware, that FDA adverse events carry a 6 month lag. The latest data was for Q2 of 2014. Please follow along on this.....Q2 is for April, May, and June of 2014. Seeing that Contrave did not launch until October, there would be no data to report on. The first Contrave data is still 9 months away.

    If you would like to donate your time to correlate the Qsymia data to the specific adverse events, then I will gladly publish it. It is likely about a 6 hour process. I do not have the time to do it, but did take the time to do the ratio's (if you look).

    I made no real comment on the data, nor the adverse events. You could say. "Thank You" and assess the data, or you could complain. You made a choice to complain.
    Jan 9, 2015. 12:54 PM | 9 Likes Like |Link to Comment
  • Belviq Q2 2014 Adverse Events Published [View instapost]
    chemist...

    I agree. We all know that the system is far from perfect. That does not mean that no quality control exists. Reports from doctor's would certainly be likely to be more accurate than reports from "joe Consumer"
    Jan 9, 2015. 10:44 AM | Likes Like |Link to Comment
  • Belviq Q2 2014 Adverse Events Published [View instapost]
    One...

    Adverse events can be reported by doctors, users, and the company.
    Jan 8, 2015. 10:48 PM | Likes Like |Link to Comment
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