Seeking Alpha

Spencer Osborne's  Instablog

Spencer Osborne
Send Message
Spencer Osborne is founder of Satellite Standard Group [SSG], and a partner of Sirius Buzz ( Sirius Buzz covers the satellite radio industry as well as companies that do business in this sector. Sirius Buzz provides information and opinion to readers with an interest in... More
My company:
SiriusBuzz Premium
My blog:
View Spencer Osborne's Instablogs on:
  • Belviq Adverse Events Q3 Of 2014

    The FDA has published the Q3 of 2014 data for adverse events relating to Belviq. There were 301 reports during the quarter on about 144,000 scripts written. Adverse event data typically runs about 6 months behind.

    The highest level of events for 1 person was 11. The average person had 2.1 adverse reactions. There were 156 different types of reactions reported. the most common reactions were:

    • 57 Reports of Fatigue
    • 54 Reports of Dizziness
    • 45 Reports of Headache
    • 36 Reports of the Drug Being Ineffective
    • 21 Reports of Nausea
    • 17 Reports of Weight Increasing
    • 13 Reports of Dry Mouth
    • 11 Reports of Constipation
    • 11 Reports of Somnolence
    • 10 Reports of Irritability
    • 10 Reports of Chills
    • 10 Reports of Back Pain

    In Q2 of 2014 there were 170 Adverse Events reported. Competitor Qsymia had 241 adverse events reported. Contrave data is not yet available.

    Tags: ARNA
    Apr 21 8:18 PM | Link | 1 Comment
  • Side Effects And Efficacy Of New Weight Loss Drugs

    This topic often arises when trying to discuss any of the drugs in this sector. Depending on what company an investor is in, often determines what spin will be applied. Arena investors love to tout safety. Vivus investors love to tout efficacy. Contrave investors love to tout that they are in the sweet spot between Belviq and Vivus. Meanwhile, Novo Investors are simply a pretty quite bunch invested in a massive big pharma company and not very worried about the debates such as this.

    That being said, I have taken the time to list all side effects over 2% according to the FDA label on Belviq, Contrave, Qsymia Low Dose, Qsymia Mid Dose, Qsymia High Dose, and Saxenda. I took the ratio of a side effect vs. the placebo to arrive at a number. That number was then assigned a rank from 1 to 6 with 1 being the best and 6 the worst. There were safety advantages and disadvantages to each drug.

    (click to enlarge) Chart Source - Spencer Osborne

    The result of this analysis of "safety" is that Belviq was the safest, followed by Contrave, Saxenda, Qsymia Low Dose, Qsymia Mid Dose, and lastly Qsymia High Dose. Be aware, this is simply an anecdotal assessment based on reported side effects included in the FDA label. There are various other safety concerns with each drug.

    Shifting to efficacy, we have yet another anecdotal look at the FDA results. Again, I used the ratio method of results vs. placebo. In looking at things in this manner, Qsymia is the most effective, while Saxenda in regular patients is the least effective. If you look at the data, you can see why Novo Nordisk is focusing on people that are overweight and have type 2 diabetes. Saxenda ranks quite high in that area, and is in fact the best in that category.

    (click to enlarge)

    Chart Source - Spencer Osborne

    Investors can debate these things until the cows come home, but remember this. You are in a stock. The goal is to see the stock do well. One of these drugs is likely to help someone. Each drug has its selling points and its pitfalls.

    Apr 13 2:51 PM | Link | 1 Comment
  • Enteromedics Makes Key Hire - Will Not Start For Two Months

    Enteromedics (NASDAQ:ETRM) announced today that the company has hired Scott A. Shikora, MD, FACS as its Executive Vice President of Medical Affairs and Chief Medical Officer. Dr. Shikora graduated from Columbia and has served in the prestigious New England medical community for many years.

    An announcement of this type should be well recioeved by investors as a potential to future growth, but should also have investors scratching their heads as to why the company waited until this point to make this hire. In addition to Dr. Shikora, Enteromedics announced the hiring of Tonya Dowd, MPH as Vice President of Reimbursement, effective April 4, 2015. This hiring will help the company through the insurance side of its business as the launch approaches.

    For some investors, these announcements should provide a bit of a wake-up call with regard to timing and expectations. I have long stated that this year will be a very modest year for Enteromedics, and if the device carries potential, it will be 2016 that tells us the levels to expect. Some investors seem to feel that the Maestro vBloc device will be a staple in the anti-obesity market. My personal belief is that it will have a niche in the space, and managed properly can deliver impressive revenues.

    Enteromedics manufactures a medical device that is much like a peacemaker. The device is surgically installed and delivered about 10% weight loss in clinical trials. Some patients saw greater weight loss. The surgery for the Maestro device is much less invasive than traditional bypass and lap band procedures, but also typically delivers less weight loss. Maestro is approved for people with a BMI of 40 or more or for people with a BMI of 35 or more and a qualified co-morbid condition.

    For perspective, a 5'8" person should weigh 160 pounds. If that person has no co-morbid condition, they would need to weigh 260 to qualify for use. If that person had a co-morbid condition, they would qualify at 230 pounds. The 260 pound individual can anticipate losing 26 pounds. The 230 pound person can anticipate losing 23 pounds. The weight loss begins to flatten out at the 6 month point.

    Chart Source - FDA Label For Maestro Device

    There are people that lose more weight. The data for weight loss in responders (about half of those that tried the device) is as follows:

    Chart Source - Maestro Label Filed With FDA

    Thus, half of those that attempt are not responders, and the other half can lose between 10% and 20% of their weight. Remember, excess weight and total body weight are different numbers.

    For investors in this equity the bottom line is as follows:


    The equity is under a lot of pressure. The company received FDA approval in January, and has not been very transparent on setting up launch dates, guiding to expectations, or giving insights on how the financials come into play. The stock has dropped below the $1 per share threshold that is a requirement for NASDAQ listing. The company has closed below $1.00 for 7 business days. If this situation remains for 30 business days, a delisting notice will be sent out. The company has about $11 million in cash, and likely needs a cash infusion to really launch this properly. Obtaining cash from implants is not likely enough to solve this issue. The problem is that the street can already see the cash need, the de-listing issue, and the dynamics at play. This means that the equity is between a rock and a hard place. Even worse, some retail investors have very high expectations that are likely to be well above what is reasonably possible. Until the company gives real guidance and frames expectations, these market pressures will continue to come to bear.


    The key hirings announced today will help to establish needed confidence in the longer term. Getting insurance coverage is critical, as is getting doctors to perform the surgeries with Maestro. Convincing the medical community that the Maestro device is a possible step prior to attempting more invasive surgery will be a challenge. A Doctor with the resume of Dr, Shikora can help this process along. If the company can get the installation ball rolling in the later half of 2015 and correct the financing and listing issues, the mid term may be able to build stability and a base for the equity.


    The long term will be dictated by what happens in the next 6 months. 2016 will be critical, and the process needs to be up, running smoothly, and generating growth as Q1 of 2016 closes. As stated, there is a niche for the Maestro device. There is potential. There is also risk. Investors need the company to frame guidance, keep expectations real, execute on a business plan that takes all facets of this operation into consideration.

    In summary, the announcement today is a positive in that the company recognized a need and is filling it. It is a negative in that we are 3 months past approval and the plan seems to be just now getting its due consideration. The market pressures will remain intense and the listing requirements need to be addressed sooner rather than later. I do not see this company getting de-listed, but I can picture the process starting, and that is never something that instills investor confidence. Enteromedics needs the support of bigger market players. This equity can not progress on the backs of retail investors with pie in the sky expectations. Stay Tuned!

    Tags: ETRM, long-ideas
    Apr 07 7:28 AM | Link | Comment!
Full index of posts »
Latest Followers


More »

Latest Comments

Posts by Themes
Instablogs are Seeking Alpha's free blogging platform customized for finance, with instant set up and exposure to millions of readers interested in the financial markets. Publish your own instablog in minutes.