Orexigen Therapeutics has identified a possible path to approval for Contrave, its obesity drug. Approval could come as early as 2014 if things go smoothly. There have been no new prescription diet drugs introduced in the U.S. in more than a decade.

Orexigen Therapeutics has identified a possible path to approval for Contrave, its obesity drug. Approval could come as early as 2014 if things go smoothly. There have been no new prescription diet drugs introduced in the U.S. in more than a decade.

After months of uncertainty as it sought to resolve a dispute with the Food and Drug Administration, La Jolla-based Orexigen Therapeutics Inc. surprised Wall Street last week with the announcement that it would revive plans for advancing its experimental obesity drug Contrave.

If approved by the FDA, Contrave would be Orexigen’s first product — and it clearly has the potential for blockbuster status, stock analysts say. Now, for the first time since January, the company is able to plot out the required steps for getting it onto the market.

“With over 70 million Americans now defined as obese, weight loss has become a major unmet medical need,” contributing to conditions such as diabetes and cardiovascular disease, Joshua Schimmer, a health care analyst at New York-based investment bank Leerink Swann LLC, said in a research report. There have been no new prescription diet drugs introduced in the U.S. in more than a decade.

Orexigen’s lead drug candidate helps patients lose weight by reducing appetite, boosting metabolism and addressing the reward system in the brain that causes food cravings, according to the company.

Orexigen submitted Contrave — a combination of well-established drugs bupropion and naltrexone — to the FDA in March 2010 after completing Phase 3 clinical trials. But the FDA responded to Orexigen’s submission Jan. 31 with a so-called “complete response letter,” which the agency issues when it finishes reviewing a file but doesn’t move forward with an approval.

A Big Trial

The FDA asked Orexigen to conduct a large trial, involving 60,000 patients or more, to rule out certain cardiovascular risks. But Orexigen said such a study would be excessive and prohibitively expensive. After a discouraging follow-up meeting with the FDA in June, Orexigen announced it was putting on hold any further clinical development in the United States until “a clear and feasible path to regulatory approval is identified.”

“We’re happy to say that such a path has indeed been identified,” Orexigen CEO Michael Narachi told investors in a Sept. 20 webcast. That path includes a “reasonably sized” study that would require fewer than 10,000 patients, cost less than $120 million, and take less than two years from the start of the trial to an interim analysis. “If the interim analysis meets the specified criteria to exclude an unacceptable increased cardiovascular risk, the drug could be approved,” the FDA said. That could happen by 2014, Narachi said.

In the wake of the announcement, Orexigen’s shares, which trade on Nasdaq under the symbol OREX, rose 49 percent to $2.19, and trading volume skyrocketed. Leerink Swann said the news is “a positive and big surprise,” and JMP Securities, a division of New York-based JMP Group Inc., upgraded Orexigen’s rating to Market Outperform, calling the announcement “a significant step forward.”

Seeking Approval

The FDA has been closely scrutinizing obesity drugs ever since safety problems emerged in the late 1990s with products including fen-phen, a combination of fenfluamine and phentermine. This has translated into a troublesome road to approval for companies in the weight-loss space.

Vivus Inc. of Mountain View and Arena Pharmaceuticals Inc. of San Diego received complete response letters for their weight-loss drugs in late 2010, followed by Orexigen’s letter in early 2011.

But now there are signs the tides are turning. On Sept. 15, Vivus said it reached an agreement with the FDA to resubmit its Qnexa drug for approval. The FDA had been concerned about possible risks for birth defects and increased heart rate with Qnexa.

“Orexigen’s decision to resume development of Contrave and Vivus’ announcement it would resubmit its application for Qnexa are encouraging steps toward a more predictable and consistent regulatory pathway for approval of new weight-loss drugs,” said Todd Gillenwater, senior vice president of public policy for the San Diego-based California Healthcare Institute, a nonprofit trade group.

Arena, meanwhile, is pushing ahead to submit its response to the FDA by the end of the year, said Jack Lief, Arena’s president and CEO. Arena’s drug, lorcaserin, was not approved because of possible cancer risks. Lorcaserin is a brand new drug, not a combination of existing medicines as in the cases of Orexigen’s Contrave and Vivus’ Qnexa.

Another player in the San Diego obesity space Amylin Pharmaceuticals Inc. in August decided to stop development of its investigational weight-loss treatment, a spokeswoman said. The decision was made based on a “commercial reassessment” of the program, which had been in Phase 2 development as a twice-daily injection.

Amylin and its partner Takeda Pharmaceuticals Inc. of Japan, “will continue to evaluate other assets as potential candidates for the treatment of obesity and related indications under the terms of our existing collaboration agreement,” a spokeswoman said in a statement.