Shares of Vivus Inc. (VVUS) sank eight percent in extended hours on Monday, after the U.S. Food and Drug Administration extended by three months a decision on its obesity drug Qnexa.
The FDA now has set July 17, 2012 for a decision on the Qnexa New Drug Application. Earlier, the FDA had set an action date of April 17.
Vivus had recently indicated the submission of a Risk Evaluation and Mitigation Strategy for Qnexa and that the FDA extended the PDUFA date in order to review the submission.
Qnexa is a once-a-day, proprietary, oral, controlled-release formulation of low-dose phentermine, a generic weight loss drug, and topiramate, used to treat epilepsy and migraines. If approved, Qnexa will will address weight loss, type 2 Diabetes and obstructive sleep apnea.
A FDA panel last February recommended approval of Qnexa for the treatment of obesity in adults, following which Vivus stock value nearly doubled.
The FDA initially had rejected Qnexa in 2010, citing potential cardiovascular problems and more chances of cleft lips in children born to women who conceive while taking the drug.
Vivus resubmitted Qnexa with longer-term data and analyzes. In phase 2 and 3 trials to date, Qnexa has shown efficacy with regard to weight loss, glycemic control, and improvement in cardiovascular risk factors, when used in combination with dietary and lifestyle changes.
FDA officials in their second review of Qnexa still cited concerns about potential risks for birth defects and heart problems, but acknowledged the drug's ability to help patients lose weight.
The market for anti-obesity drugs is virtually untapped, with a host of drugs failing to find favor with the FDA. The Agency last year rejected two experimental obesity pills -Arena Pharmaceuticals' (ARNA) Lorcaserin, and Orexigen Therapeutics' (OREX) Contrave.
Some approved pills like Abbott's (ABT) Meridia have been pulled from the U.S. market due to safety concerns. Roche's Xenical, a prescription anti-obesity drug and GlaxoSmithKline plc's (GSK) Alli, an over-the-counter weight-loss product are two FDA-approved drugs for obesity in the market.
VVUS closed Monday on the Nasdaq at $22.92, up $0.39 or 1.73%, on a volume of over 8.5 million shares. In after hours, the stock lost $1.79 or 7.81%. In the past year, the stock ranged between $6.13 and $25.14.
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