Orexigen's post-Takeda plans for Contrave don't include 2016 growth

In the wake of Takeda’s walk-away from a joint marketing partnership on flailing obesity med Contrave, Orexigen has its go-it-alone marketing plans figured out. Problem is, they won’t result in growth for quite a while.

Over the last few weeks, the California drugmaker has brought on an SVP of market access and development and a VP of sales to beef up its commercial leadership team, and it’s already finished hiring 15 regional sales managers, commercial chief Tom Cannell told investors on the company’s Q1 conference call. When Orexigen officially sets sail alone in Q3--after a 6-month transition period with Takeda--those new hires will be overseeing a group of 160 reps, which Orexigen will bring on within the next couple of months.

The company has also partnered with contract sales organization inVentiv Health to help it staff those rep ranks, and through that partnership, Orexigen is confident it can “build a sales organization capable of achieving or exceeding the market share and sales growth increases we projected.”

There’s just one issue: Orexigen didn’t project any sales growth increases for 2016. The company predicts “zero-to-limited growth” for the year, as RBC Capital Markets analyst Simos Simeonidis put it in a recent write-up for clients, noting that “we continue to expect the next 12 months to be very difficult ones” for Contrave.

Orexigen, for its part, sees things looking up down the line. It expects to boast 10% to 11% of the obesity market in 2018, and it predicts it’ll reach profitability the year after that, execs said on the call.

Luckily for Orexigen, its competitors in the obesity market are struggling, too--meaning it may be able to afford losing a year of expansion in the market-share race. Sales of Arena rival Belviq have actually declined for 5 straight quarters, and Vivus’ Qsymia--which Simeonidis calls the “market’s best drug”--is working hard to maintain sales despite last year’s massive rep scale-back.

The lack of near-term Orexigen profits could get tricky, though. After all, the company still needs to fund a re-do of the botched cardiovascular outcomes trial that brought friction to its Takeda relationship in the first place--and Simeonidis has predicted that trial could cost it $210 million.

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