With Arena Pharmaceuticals (ARNA) Halted Ahead of AdCom, There Will Be Other Ways to Play...
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Shares of Arena Pharmaceuticals (Nasdaq: ARNA) were halted for trading earlier Thursday ahead of the all-important FDA Advisory Committee meeting on its obesity drug locaserin. With a final vote expected between 3-5PM ET today, shares will likely be halted for the entire regular trading session, possibly re-opening in the after-hours session.
For those who want to follow the action from the meeting in real-time, TheStreet.com's Adam Feuerstein has a live blog going on here. StreetInsider.com, of course, will report any major developments as they happen in our real-time news feed.
With Arena halted, traders will be keeping an eye on rivals VIVUS Inc. (Nasdaq: VVUS) and Orexigen Therapeutics, Inc. (Nasdaq: OREX). VIVUS has already received backing from FDA panel and has a PDUFA of July 17th, 2012, when it is widely expected the company's Qnexa will gain approval. However, with worries about possible CV trials, the launch of the drug remains in question.
Arena's PDUFA date is currently set on June 27th, 2012 -- before VIVUS. If Arena gains FDA panel backing, it is theoretically possible that the company could be first to market. That is a huge if though, as a 3-month PDUFA date extension -- as was the case with VIVUS -- could be in the cards. The main thing -- FDA panel backing –- is the major question. Some analysts see panel backing as unlikely.
SummerStreet, for example, expects the panel will vote against approval for multiple reasons and the FDA will issue Arena another complete response letter.
"It is likely that the panel will want new efficacy studies to show improved efficacy (either in a subgroup or used in combination with a second drug) and new safety studies to rule out cancer risks. Cardi0viascular safety studies may even be requested. Our opinion is that ARNA’s lorcaserin is a long way from the market and will not obtain FDA approval before completing extensive new clinical trials."
Others see Arena gaining panel backing. Just Wednesday, BMO Capital upgraded the stock to Outperform and raised the stock's price target 600 percent to $7, saying it expects a favorable outcome.
Whatever the case, while ARNA is halted, trading will be fast and furious in VVUS and OREX as traders hang on every word from the panel meeting.
For those who want to follow the action from the meeting in real-time, TheStreet.com's Adam Feuerstein has a live blog going on here. StreetInsider.com, of course, will report any major developments as they happen in our real-time news feed.
With Arena halted, traders will be keeping an eye on rivals VIVUS Inc. (Nasdaq: VVUS) and Orexigen Therapeutics, Inc. (Nasdaq: OREX). VIVUS has already received backing from FDA panel and has a PDUFA of July 17th, 2012, when it is widely expected the company's Qnexa will gain approval. However, with worries about possible CV trials, the launch of the drug remains in question.
Arena's PDUFA date is currently set on June 27th, 2012 -- before VIVUS. If Arena gains FDA panel backing, it is theoretically possible that the company could be first to market. That is a huge if though, as a 3-month PDUFA date extension -- as was the case with VIVUS -- could be in the cards. The main thing -- FDA panel backing –- is the major question. Some analysts see panel backing as unlikely.
SummerStreet, for example, expects the panel will vote against approval for multiple reasons and the FDA will issue Arena another complete response letter.
"It is likely that the panel will want new efficacy studies to show improved efficacy (either in a subgroup or used in combination with a second drug) and new safety studies to rule out cancer risks. Cardi0viascular safety studies may even be requested. Our opinion is that ARNA’s lorcaserin is a long way from the market and will not obtain FDA approval before completing extensive new clinical trials."
Others see Arena gaining panel backing. Just Wednesday, BMO Capital upgraded the stock to Outperform and raised the stock's price target 600 percent to $7, saying it expects a favorable outcome.
Whatever the case, while ARNA is halted, trading will be fast and furious in VVUS and OREX as traders hang on every word from the panel meeting.
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