Vivus' Qnexa Will Outpace Competition From Alli, Boost Stock

| About: Vivus, Inc. (VVUS)
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Vivus (VVUS) is currently waiting for FDA approval of the most anticipated weight-loss drug this year. Qnexa has completed Phase 3 clinical trials and received positive results. Based on the results, it is pretty clear that Qnexa stands above most of its market competition.

Unfortunately, the FDA recently released its decision to take another three months to review Vivus' weight drug before it makes the decision to allow Qnexa's market release. Vivus had originally planned to release its weight loss treatment on the market by April 17, ahead of competitors. This would have allowed Qnexa to corner the market. The date is now set to July 17. Success for Qnexa will now rely on the effectiveness and safety of the treatment in comparison to its competitors.

Qnexa is a combination drug, consisting of phentermine and topiramate. The combination of these two chemicals creates a synergistic effect on weight loss in the body, an edge that other weight loss drugs lack. Topiramate affects the central nervous system of the body by acting as an antagonist to AMPA/KA receptors in the brain. By shutting down AMPA/KA receptors, it is believed that topiramate quells addictive food cravings and binging. The clinical results convey the decrease in food cravings.

Furthermore, it has been observed that topiramate increases lipoprotein lipase in brown adipose tissue, and decreases lipoprotein lipase in white tissue. This is the desired effect for a weight loss drug. Phentermine has been prescribed as an appetite suppressant for many years. Existing as a noradrenergic sympathomimetic amine, phentermine is very useful in short-term obesity treatment.

Qnexa studies have revealed that the drug works very well. A 52-week study enlisting 2,487 patients in 93 U.S. sites showed that 48% of patients taking the high dose Qnexa and 37% taking mid-dose Qnexa lost greater than 10% of their body weigh. The remainder of the patients lost greater than or equal to 5% of their body weight. A continuing study of the same patients extended the research another 52 weeks. An average weight loss of 9% from the original patients' body weight occurred at the end of the second study.

Side-effects from the study revealed that up to 18% of patients taking the full dosage of Qnexa suffered from dry mouth, tingling, constipation, headache, and respiratory tract infection. While these side effects can cause a patient some annoyance, they are rather common in most drugs and shouldn't cause the drug to be denied by the FDA. Overall, Qnexa is in very good standing to gain FDA approval.

Arena Pharmaceuticals (ARNA) and its weight loss drug Lorcaserin, is poised to be Vivus' main competition. Like Qnexa, Lorcaserin is also under FDA review after a resubmission of its new drug application. After failing to receive new drug approval by the FDA in 2010, Arena has redeveloped and improved its main weight loss drug. Lorcaserin studies revealed that 37.5% of patients taking Lorcaserin achieved a loss of at least 5% body weight and 16% of patients lost more than 10% of their body weight. Furthermore, Lorcaserin created a large decrease in type-2 diabetes risk and lowered lipid levels. The side effects reported in the study included headache (14.5%), back pain (11.7%), respiratory infection (13.7%), nasopharyngitis (11.3%), and hypoglycemia (29.3%).

The fact that this drug caused hypoglycemia in nearly one-third of its patients is a noticeably large figure. Low blood sugar can cause adverse and dangerous effects such as double vision, fainting, seizures, and even cause a coma. While easily treated, this hypoglycemia could be a red flag for the FDA. The drug could become approved with a requirement of "taking with soda or juice," but the FDA could just as easily require Arena to fix the problem before the drug can be marketable. While seemingly silly, the FDA does take into account that many people fail to read a drug label correctly or at all. Therefore, Lorcaserin must be as safe as possible before the public is allowed access.

Eli Lilly (LLY) and Vivus have competing drugs for diabetes in the market. Vivus is currently developing DM-230, while Eli Lilly has 5 diabetes drugs in its pipeline. The drug that will prevail on the market cannot be determined until Vivus' diabetes drug finishes clinical testing within the next few years. Considering the multiple diabetes drugs already selling in the market, I doubt Vivus will make much capital due to over-competition.

Pfizer (PFE) and its diabetes drug Exubera does not project much competition for Vivus if DM-230 is approved. Only one in every 500 prescriptions for diabetes treatment is Exubera, which brings almost no profit to Pfizer. GlaxoSmithKline (GSK) provides some competition to Vivus with a weight loss drug named Alli. It is not as effective as Qnexa, based on the Qnexa clinical results. Qnexa will be a more desired and valued product on the market than Alli.

Vivus has established solid research data on the effectiveness of Qnexa. The fact that almost all previously created weight loss drugs are scams or have dangerous side effects makes Qnexa very valuable to the public eye. In the United States alone, 35.7% of adults are obese. An even more troubling statistic is that 17% of American children ages 2 to19 are overweight. With just over half of Americans and more than 500 million people in the world classified as obese, Qnexa and Lorcaserin have a vast market to thrive in if they become FDA approved.

Vivus and Arena both have a large market, enough money to effectively advertise and produce its drugs, and good prospects for FDA approval. By the end of the year, the effectiveness and safety of the drugs will decide which will produce more capital and be favored by doctors. As far as the research data shows for now, Qnexa is the better drug.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.