Analysis: Obesity drugs to $1.7B by 2014
By Steve Mitchell
Mar 22, 2006, 19:00 GMT
WASHINGTON, DC, United States (UPI) -- The launch of obesity drugs from three pharmaceutical companies will propel the sector to more than $1.7 billion in sales by 2014, with Sanofi-aventis` Accomplia accounting for the lion`s share of that amount, an analyst firm predicts in a new report.
\'The obesity market is going to grow substantially over the next decade, but it`s still going to be facing some hurdles,\' Stephanie Krebs, the author of the report and an analyst with Decision Resources, told United Press International.
\'We project it growing to $1.7 billion by 2014, $1.1 billion of which will be Accomplia,\' added Krebs. The weight-loss drug market in the United States, France, Germany, Italy, Spain, the United Kingdom and Japan totaled less than $500 million in 2004.
The hurdles include that patients don`t often seek medical treatment for obesity and a lack of insurer reimbursement for drugs that treat the condition. In addition, the Fen-Phen withdrawal in 1997 has left a lingering bad taste about obesity drugs among physicians.
These factors limit drug uptake, but manufacturers can capitalize on this by distinguishing their new products from older therapies, Krebs said.
Sanofi-aventis` Accomplia may be able to do that because it is the first obesity drug that appears capable of improving cardiovascular and metabolic factors, such as increasing HDL levels, lowering triglycerides and improving insulin sensitivity.
\'This is an example of where a product is differentiating itself from previous products,\' Krebs said. \'That awareness of a new drug being available for obesity is going to raise awareness of other treatments, so that`s part of the reason why we think the market is going to continue growing.\'
Sanofi-aventis has said it anticipates launching Accomplia sometime this year.
Other drugs coming down the pipeline include Alizyme`s cetilistat, which is in phase 1/2, and Arena`s APB-356, which is in phase 2.
Cetilistat has a mechanism of action that is similar to Roche`s Xenical. Even though it appears to have a better side-effect profile, \'we don`t think physicians will be as excited about this drug because of their experience with Xenical,\' Krebs said.
APB-356 has a mechanism of action similar to fenfluramine, which could count against it, but Krebs said she predicts Arena \'will go to great lengths to prove safety, so if it does make it to market, it will promote a great deal of weight loss and patients will be really excited about it.\'
Prudential analyst Tim Anderson in a report issued Wednesday raised the target price for Sanofi-aventis from $47 to $50 based on the company`s settlement of the patent challenge against Plavix from Apotex.
Anderson added that the Food and Drug Administration`s approval of Accomplia remains a critical factor for Sanofi over the next few quarters. But he added, \'(Sanofi) has guided for a (second half of 2006) launch, which we feel is likely to be on track.\'
Piper Jaffray analyst Sam Fazeli, in a report issued last week, rated Alizyme as \'outperform,\' but noted that \'Alizyme`s cash position currently prohibits it from taking cetilistat .... forward.
However, Fazeli attributed much of Alizyme`s 25 percent increase in shares this year to the strength of the phase 2b Cetilistat data. This could make the drug attractive for potential partners, he added.
\'This view is corroborated by our conversations with senior licensing personnel from two pharma companies,\' Fazeli wrote. \'Thus, we believe there is a good chance that cetilistat will be out-licensed during 2006. We see this as the main catalyst for Alizyme`s stock and view the recent fall in the shares as a buying opportunity.\'
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