DJ Arena Pharma Rallies On FDA Optimism; Vivus Shares Halted
.
By Val Brickates Kennedy
Investors bid shares of diet-drug developer Arena Pharmaceuticals Inc. (ARNA) higher Thursday, ahead of a Food and Drug Administration panel meeting on a weight-loss product candidate made by rival Vivus Inc. (VVUS).
More broadly, the sector's two leading indexes moved lower as stock benchmarks on Wall Street staged a broad retreat.
The NYSE Arca Biotechnology Index (BTK) fell 0.8% to 1037.88, while the NYSE Arca Pharmaceutical Index (DRG) was nominally lower at 287.30.
Shares of Arena rocketed 16% to $4.95.
Later Thursday, the FDA panel will discuss whether the agency should approve Vivus' diet-drug Qnexa, one of three new diet drugs up for U.S. approval. The others are Arena's lorcaserin and Contrave, developed by Orexigen Therapeutics Inc. (OREX).
While the FDA isn't bound to follow the recommendations of its panels, it generally does so.
Meanwhile, trading was halted in shares of Vivus pending the outcome of the FDA meeting. Orexigen shares were largely flat at $5.56.
Anticipation over the FDA meeting was one of several factors contributing to the buying in Arena shares, which also were stoked by news that data from a two-year clinical trial for lorcaserin showed that users lose more weight than those taking a placebo. The results are published in the current edition of the New England Journal of Medicine.
Also boosting Arena shares was a Wednesday FDA panel meeting convened to discuss the cardiovascular risks posed by Avandia, a leading diabetes drug developed and marketed by GlaxoSmithKline PLC (GSK).
Of the three diet drugs that the FDA's considering for approval, lorcaserin is believed to carry the lowest cardiovascular risk.
Separately, GlaxoSmithKline shares moved up 2% to $37.06.
While the FDA panel on Wednesday said they believed Avandia could increase the risk of heart attack in certain users, it didn't recommend the product be taken off the market.
GlaxoSmithKline said Thursday that it would take a $2.36 billion charge in the second quarter for settlements costs related to several legal cases, noting that a "substantial majority" of the product liability cases filed over Avandia had been settled. Questions over Avandia's cardiac safety first arose publicly in 2007.
-By Val Brickates Kennedy, 415-439-6400; AskNewswires@dowjones.com
News 
Market Data 
Discover 
AI
