Orexigen Therapeutics Crushed After FDA Rejects Contrave Approval (OREX)

Orexigen Therapeutics OREX is absolutely crushed today on a pessimistic CRL from the FDA. After reopening from a NASDAQ trading halt for the news release, the stock hit levels over 71% lower than Monday's close. Orexigen Therapeutics, Inc. OREX and Takeda Pharmaceutical Company Limited announced today that the United States Food and Drug Administration (FDA) has issued a complete response letter dated January 31, 2011 regarding the New Drug Application for Contrave® (naltrexone HCl/bupropion HCl) extended-release tablets for the treatment of obesity, including weight loss and maintenance of weight loss. The FDA noted concern about the cardiovascular safety profile of naltrexone/bupropion when used long-term in a population of overweight and obese subjects. Specifically, the letter stated that "before your application can be approved, you must conduct a randomized, double-blind, placebo-controlled trial of sufficient size and duration to demonstrate that the risk of major adverse cardiovascular events in overweight and obese subjects treated with naltrexone/bupropion does not adversely affect the drug's benefit-risk profile." "We are surprised and extremely disappointed with the Agency's request in light of the extensive discussion and resulting vote on this topic at the December 7 Advisory Committee meeting," said Michael Narachi, President and CEO of Orexigen. "We plan to work closely with the Agency to gain more information to determine the appropriate next steps regarding the Contrave application." Contrave, an investigational combination therapy of naltrexone HCl and bupropion HCl, was studied for its ability to help people with obesity initiate and sustain weight loss of at least 5 percent of their starting body weight in one year. Contrave was submitted for U.S. regulatory approval in March 2010. The original submission was based on multiple clinical trials that evaluated Contrave in more than 4500 patients.