Zacks Analyst Blog Highlights: Amylin Pharmaceuticals, Inc., Arena Pharmaceuticals, Vivus Inc., Orexigen Therapeutics and CVS Caremark Corporation - Press Releases
For Immediate Release
Chicago, IL – February 25, 2010 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Amylin Pharmaceuticals, Inc. (AMLN), Arena Pharmaceuticals (ARNA), Vivus Inc. (VVUS), Orexigen Therapeutics (OREX) and CVS Caremark Corporation (CVS).
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Here are highlights from Wednesday’s Analyst Blog:
AMLN’s Obesity Pipeline Advances
Amylin Pharmaceuticals, Inc. (AMLN) and partner Takeda Pharmaceutical Company Limited recently announced that they intend to advance their obesity combination treatment of pramlintide and metreleptin into phase III studies.
The decision is based on encouraging 52-week results on the combination treatment from a blinded, placebo-controlled phase II extension study in which the combination succeeded in achieving the key target of sustained and robust weight loss.
Results showed that patients who continued treatment with pramlintide/metreleptin for 52 weeks experienced sustained weight loss, while those on placebo regained almost all of their weight. The combination treatment was found to be most effective in patients with a body mass index (BMI) less than 35 kg/m2.
The combination treatment was generally well tolerated, with nausea and injection-site-adverse events being the most common side effects on initiation of treatment. Full results from this study will be presented at an upcoming medical meeting.
Meanwhile, Amylin and Takeda also provided an update on their development plans for another obesity candidate, davalintide. The partners announced that they do not intend to pursue further development of davalintide for the time being.
The decision is based on results from a phase II study which showed that the weight loss efficacy and tolerability profile of davalintide was not superior to pramlintide, and was inferior to the pramlintide/metreleptin combination.
While the decision to halt further development of davlintide is disappointing, we are encouraged to see that the pramlintide/metreleptin combination will move into phase III development.
Obesity is an attractive market that could be worth many billions of dollars. It is estimated that obesity affects over 400 million people worldwide. Moreover, obesity is linked to increased health risk of several medical conditions.
Given the huge unmet need in this market, the successful development of the obesity pipeline would help drive long-term growth at Amylin. However, we note that Amylin is not the only company seeking to develop a treatment for obesity. Companies like Arena Pharmaceuticals (ARNA), Vivus Inc. (VVUS) and Orexigen Therapeutics (OREX) are all seeking to bring obesity treatments to market.
CVS Upgraded to Neutral
We have recently upgraded our recommendation on CVS Caremark Corporation (CVS) to Neutral. During the fourth quarter of 2009, the company reported earnings per share (EPS) of 79 cents, beating the Zacks Consensus Estimate by a penny. Revenues increased 7% year-over-year to $25.8 billion, driven by the robust growth of both segments – Pharmacy Services and Retail Pharmacy.
Recent revisions in 2010 earnings estimates for CVS have followed a strong upward (positive) bias. Over the last 30 days, 10 of the 19 analysts following the stock have raised their estimates for fiscal 2010, with only 4 analysts moving in the opposite direction. An upward bias can be witnessed in the last 7 days as well, with 2 of the 19 analysts raising their estimates. There were no downward revisions during this period.
Although the loss of $4.8 billion worth of PBM contracts for 2010 was a big blow, CVS is taking several initiatives to avoid such incidents. The company has been trying to detect service issues or other areas of dissatisfaction among its clients. For 2011 selling season, about $7.5 billion worth of contracts are up for renewal. The encouraging outlook for 2011 is evident from the fact that 5 of the 20 analysts covering the stock have raised their estimates while only 3 have moved in the opposite direction.
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