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Arena takes smaller 2Q loss after drug approval

SAN DIEGO (AP) -- Arena Pharmaceuticals Inc. said Thursday it took a smaller loss in the second quarter after it received a large payment following the approval of its obesity drug Belviq.

Arena received $20 million from its marketing partner Eisai Co. because the prescribing information for Belviq will include safety and effectiveness data from a late-stage trial of the drug. The Food and Drug Administration approved Belviq on June 27, and Arena and Eisai plan to begin marketing the drug in early 2013. Belviq was the first chronic obesity drug to get approval since the late 1990s.

The company lost $22.1 million, or 12 cents per share, in the second quarter. A year ago Arena lost $22.9 million, or 16 cents per share. Its revenue rose to $22 million from $3.3 million. Arena reported lower research and development and other costs, but it took a charge of $16.8 million connected to derivative liabilities and a $4.7 million loss on the extinguishment of debt.

Analysts expected Arena to take a loss of 11 cents per share on $3.5 million in revenue, according to FactSet.

Arena raised its annual revenue estimate based on the $20 million payment from Eisai, and said it could get another $65 million in milestone payments later this year before Belviq goes on sale. The company now expects 2012 revenue of $91 million to $97 million, up from its previous estimate of $66 million to $72 million.

Analysts are forecasting revenue of $14.4 million on average.

Arena and Eisai are also trying to get marketing approval for Belviq in Europe and other regions. On July 17 the FDA approved Qsymia, a weight loss drug made by Vivus Inc. that was generally more effective than Belviq in clinical trials. Both drugs are approved for adults who are overweight or obese and have at least one weight-related health complication.

Shares of Arena Pharmaceuticals rose 6 cents to $7.36 Thursday, then lost 5 cents to $7.31 in after-hours trading.