The first new weight-loss pill in a decade moved closer to U.S. approval on Tuesday, when a panel of expert advisers backed Orexigen Therapeutics's Contrave despite heart risk concerns. It was the third new weight-loss drug to come before U.S. regulators this year, the Food and Drug Administration having rejected two rival medicines in October.
Orexigen's stock more than doubled to $12.20 from Monday's close of $4.76 when it reopened in after-hours trade Tuesday. Shares of competitors Vivus Inc and Arena Pharmaceuticals Inc also rose, as investors bet Contrave's approval could revive their fortunes.
The advisers were not overly impressed with the modest weight loss seen in patients taking Contrave, but some said rejection could quash development of such drugs at a time when two out of three Americans are overweight or obese.
"My concern is ... we will potentially kill development of these medications, and it is the most serious disease that the United States is facing," said panel chairman Abraham Thomas, head of endocrinology at Henry Ford Hospital in Detroit.
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