Inside the Phase III Pipeline

The three Phase III candidates in the pipeline offer fairly modest weight loss; some miss the top 5 percent mark, but all promise to meet at least the secondary criterion. This overall middling efficacy, combined with the massive size of the market demand, makes winning a "race to market" less important than in any other therapeutic areas.

"The different drugs are close enough in time, and there is such a large, undeveloped market that no drug will have a huge first-to-market advantage," says Chang. "Being first won't put much of a restriction on subsequent drugs. Although if the first one is tolerable, the patients who go on it may not want to switch."

The drug is likely to face some skepticism among primary-care physicians, according to Wong, as few may be comfortable with prescribing an epilepsy treatment for weight loss. Vivus expects to file an NDA for Qnexa by the end of 2009. Approval could come as soon as July 2010, according to Sagient's data. InThought, a unit of Wolters Kluwer, forecasts revenues of $522 million for Qnexa in 2016, while Sagient sees worldwide sales of $750 million the same year.

Contrave, by Orexigen, is another novel combination of two widely prescribed generics: the antidepressant bupropion is a dopamine and norepinephrine re-uptake inhibitor; Naltrexone is an opioid receptor antagonist used to treat alcohol dependence. Each has demonstrated modest weight-loss effects. "They show some synergies," Wong says. "Weight loss is about five to ten percent—nothing fantastic."

Contrave reported Phase III data in July. While the drug failed to achieve the primary end point of 5 percent weight loss compared to placebo, it did meet the FDA's categorical efficacy requirement. The percentage of patients in the drug group who lost at least 5 percent of their body weight was three times that in the placebo group—55.6 percent to 17.5 percent at 28 weeks; longer trial arms showed similar results. More important for reimbursement, the drug documented statistically significant improvements in cardiovascular risk factors. Orexigen expects to file an NDA in the first half of 2010, according to a company press release.

"Contrave has the best chance of approval." Cuttler says, noting that regulators are already familiar with the safety profile of both drugs in the new therapy. In 2016, Sagient predicts revenues of $406 million, compared to InThought's rosier $673 million.

The most ambitiously conceived drug in Phase III is Lorcaserin, by Arena Pharmaceuticals. The San Diego–based biotech designed a drug that closely resembles fenfluramine—the half of Fen-phen that damaged heart valves and was banned by FDA—but it appears to boast greater selectivity and therefore a much cleaner toxicity profile. "Arena is trying to make a drug that is specific for the [serotonin 2C] receptors in the brain without damaging those [serotonin 2B receptors] in the heart," Wong says.

So far, Lorcaserin's clinical efficacy has not been inspiring, Wong says. It hovers around 5 percent average weight loss. But when the drug works for a patient, it works well. About 48 percent of patients on the drug lost more than 5 percent of their body weight compared to about 20 percent for placebo. This satisfies FDA's categorical efficacy criterion. Additional Phase III data is due this month. Arena's latest press releases do not give a date for the NDA filing, but some analysts see it coming as early as December. InThought sees $849 million in revenues for the drug in 2016, while Sagient forecasts just $346 million the same year.

One of the main selling points for these drugs is the pent-up demand in a market that has not seen a new weight-loss drug since Glaxo's splashy OTC launch of Alli two years ago. "Doctors will prescribe them because their patients want a drug therapy, and there are not a lot of other options," Cuttler says. He also expects doctors to try newly approved obesity drugs in combination with diabetes drugs in the hope that it causes enough weight loss to improve cardiovascular health.

Some analysts, notably Datamonitor's Angell, are less optimistic: "The obesity market peaked in 2007 at about $600 million instead of $8 billion," he says. "Do we really think that by offering an incremental change in what we already have, we will get any closer to an $8 billion market?"