San Diego-based Arena Pharmaceuticals, Inc. saw its stock soar almost 21 percent Dec. 13 after the company announced positive clinical results for its obesity drug.
With more than two-thirds of the American population considered overweight or obese by the Centers for Disease Control and Prevention, the market for a safe, effective obesity drug is huge , and largely untapped.
Arena's stock jumped in after-hours trading after the company announced the positive midphase trial results late in the day. The stock closed at $11.41, and was up by $2.39 to $13.80 around 5 p.m. Pacific time Dec. 13.
The company touts the unnamed drug as the "safe version" of Fen-Phen. Like Fen-Phen, which resulted in more than 10,000 consumer lawsuits after the drug was linked with heart troubles, Arena's compound works by stimulating a receptor in the brain that causes the patient to feel full. But Arena said its drug had no apparent effects on heart valves or pulmonary artery pressures during the trial.
The second-phase, double-blind clinical trial involved 469 obese men and women, and the drug was tested for safety and efficacy in humans. During the 12-week trial, participants lost between four and eight pounds. Scientists found the drug was generally well tolerated at different doses. One patient had a new onset seizure, but a neurologist ruled it was unlikely to have been caused by the drug. Another experienced major depression, but the company said it was also unlikely caused by the drug because the patient had a history of depression. Between 26 percent and 31 percent of patients experienced headaches during the trial, while others had other mild side effects, such as nausea.
Drug companies are required to put their compounds through three phases of trials before submitting an application to the Food and Drug Administration for review. Arena expects its obesity drug to enter Phase III next year.
Analyst Adam Noah, of the Bay Area firm Merriman Curhan and Ford, expects Arena to end the year with about $130 million in cash.
"Today's positive Phase II results in the obesity program are just another reminder of the high quality of Arena's drug discovery and development program," Noah said. "These findings are very encouraging and certainly point to continued development of this compound."
, Katie Weeks