Orexigen endorsement raises expectations on obesity drug deals

An FDA advisory panel endorsement can make a big difference for a biotech company, especially if the vote puts you in the lead of a hotly contested drug development race.

An FDA advisory panel endorsement can make a big difference for a biotech company, especially if the vote puts you in the lead of a hotly contested drug development race.

Assessing the impact on Orexigen ($OREX) after its surprising victory for the obesity drug Contrave in the wake of two negative votes for its competitors, the Wall Street Journal notes that the endorsement sets the stage for a potentially lucrative pact covering Asia and Europe. And now the spotlight also shifts to another Orexigen weight-loss drug that's not so far advanced. Can Empatic do better-much, much better-than the $50 million signing fee Orexigen earned from Takeda on their Contrave deal?

The Journal goes on to note that everyone in the weight-loss field-including Neurosearch and Vivus--will likely benefit from the vote. This was the first endorsement of an obesity drug in 13 years, proving that it may be possible to actually make it to the marketplace with a blockbuster therapy. And t