Weak Qsymia sales have been the all-important issue for Vivus ($VVUS) since the highly anticipated obesity therapy stumbled out of the gate, inspiring an all-out proxy war that wreaked havoc on the company's boardroom. And the California company isn't about to cede what market share it does have to Actavis ($ACT)--at least, not without a fight.
Thursday, the Mountain View-based drugmaker announced it had filed a patent infringement lawsuit against Actavis, which last month notified Vivus it had submitted an Abbreviated New Drug Application for generic Qsymia with the FDA. Now that Vivus has thrown down the suit, FDA approval of the ANDA will automatically be stayed for 30 months, assuming a district court doesn't first declare Qsymia's patents--the earliest of which expires 6 years from now--invalid, unenforceable or not infringed.
Qsymia isn't the type of seller that usually draws generic challengers. It's foundered without a marketing partner--an issue that ignited shareholder unrest that led to a boardroom overhaul last summer. And things haven't been much better since. While the company last month put up Q1 top-line numbers that topped analysts' expectation, it also reported falling script numbers, with last quarter's total dropping by 3,000 compared Q4 of 2013.
But Actavis may see potential in the weight-loss drug market thanks to Arena's ($ARNA) Belviq, sales of which have grown quickly despite Qsymia's first-to-market advantage. Marketing partner Eisai has continued to pour resources and reps into promoting the drug, and so far it's paid off: Unlike Vivus, Arena in Q1 reported a 31% hike in scripts over the year-ago quarter.
And there may be more--and heftier--competition down the road. The FDA is due to make a decision on Orexigen's ($OREX) obesity pill, Contrave, by this September. If the drug does come to market, Takeda has 900 reps slated to push the new product--300 more than Eisai has dedicated to its force.
Piper Jaffray analyst Charles Duncan thinks those reps will help propel Orexigen's med to $1.5 billion in sales in 2020, with Vivus tallying only about a third of that, CNBC recently reported. And Wells Fargo's Matthew Andrews sees a Qsymia haul even smaller than that, with forecasts of $1.2 billion for Contrave, $481 million for Belviq and $396 million for Qsymia.
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Special Report: Top 10 generics makers by 2012 revenue - Actavis