Vivus investor says FDA move on Qsymia isn't enough

At least one Vivus ($VVUS) shareholder isn't convinced that loosening FDA restrictions on a new obesity pill will fuel sales in any significant way. First Manhattan, which owns a 9.1% stake in the drugmaker, said that modifications to Qsymia's risk-management plan are "necessary"--but they're "not sufficient" for its success.

That means First Manhattan still wants to sweep out Vivus' board and revamp the company. The investment firm is backing 6 nominees for the board in an attempt to turn around Qsymia's faltering fortunes. Its nominees would be "objective" stewards for the weight-loss drug, approved last year to great hopes.

"They will seek out all the facts, not just the views favored by management," First Manhattan said in a statement. And that will allow them to work on "the fundamental problems at Vivus" and "reversing the failed Qsymia launch."

Vivus claims that its new drug has been hampered by FDA's decision to restrict dispensing to mail-order pharmacies only. The company has asked the agency to allow broader distribution, through certain retail pharmacies. A decision on that request is due soon.

But First Manhattan doesn't agree, and it's not the only critic that believes Vivus needs to sign up with a marketing partner, rather than go it alone on marketing Qsymia. Analysts have advised Vivus to tap Big Pharma's sales expertise, saying that the drug will never perform up to par unless a more experienced drugmaker jumps on the case.

"In the right hands, retail distribution through certified pharmacies would enable Qsymia to reach the drug's full potential for Vivus shareholders," First Manhattan said. "Achieving this goal requires a new commercial strategy."

- see the statement from First Manhattan
- read the story from The Street