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VIVUS Inc. Message Board

  • jbwin416 jbwin416 Oct 28, 2009 1:21 PM Flag

    JMP - VVUS Weakness Presents Strong Buying Opportunity

    INVESTMENT HIGHLIGHTS

    · Concerns over cognitive tolerability profile are overblown and present opportunity to buy;

    reiterate Market Outperform rating and $18 price target on VIVUS. We believe that the

    concerns in the market yesterday related to the discontinuations from cognitive events in the Qnexa

    Phase III trials are overblown and we remain confident that the safety and tolerability profile of

    Qnexa is favorable. Furthermore, we are confident that the overall benefit-risk profile of all doses of

    Qnexa provide a compelling argument for approval. Our $18 price target is derived by assigning a

    30x multiple to our 2014 EPS projection of $1.67, discounted at 30% per year.

    · Drop outs due to cognitive events do occur at a higher rate in full dose Qnexa than placebo

    but this is expected, the rate is low, and we do not believe they will inhibit approval or

    market potential. Cognitive adverse events are known side effects of topiramate and are reflected

    on the current topiramate labels for epilepsy and migraine. In our view the key points to focus on

    here are that 1) the rate of cognitive-related events, and discontinuations due to these events, is

    expected to be higher than placebo based on the known side effect profile of topiramate, 2) the

    event rate with Qnexa is low (less than 5% for any cognitive adverse event), 3) the vast majority of

    these events are mild-to-moderate, and 4) when these events were not tolerated, and patients

    discontinued, the effects were fully reversible.


    · Cognitive tolerability may be improved in Qnexa compared with topiramate monotherapy.
    The data released from both the EQUIP and CONQUER trials indicate that CNS and cognitive

    adverse events occurred at rates below 5%, with exceptions of paresthesia, insomnia, and

    dizziness. In Figure 1 we summarize the rates reported in the topiramate label from the migraine

    trials and highlight those viewed by the FDA as dose-related. In EQUIP and CONQUER,

    paresthesia was reported in 19% and 21% of patients on full-dose Qnexa (92mg topiramate/15mg

    phentermine), respectively, compared with 50% of patients who received topiramate (100mg

    monotherapy) in the migraine trials. The frequency of dizziness was also not greater with Qnexa

    (6% and 10%) than reported in the migraine trials (9%). Insomnia rates were slightly higher in the

    Qnexa trials (8% and 10% vs. 7%), however, insomnia is known to occur at higher rates in obese

    people. We would highlight that cognitive events reported in the migraine label including language

    problems (6%),

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