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Vivus says drug delayed progression to diabetes

MOUNTAIN VIEW, Calif. (AP) -- Drugmaker Vivus said patients who took its weight loss drug Qsymia were more than 70 percent less likely to develop type 2 diabetes compared to patients who took a placebo.

The data comes from a group of patients who participated in a late-stage clinical trial of Qsymia. Those patients were at high risk for developing diabetes: they had prediabetes or a group of symptoms called metabolic syndrome, which includes high blood pressure, large waist size, and inability to handle glucose. Vivus who took the standard dose of Qsymia were 70.5 percent less likely to develop diabetes on an annual basis, and patients who took a larger dose were 78.7 percent less likely to develop diabetes than the placebo patients.

The data includes results from 475 patients from the company's Sequel study, which had a total of 676 patients.

Cowen and Co. analyst Simos Simeonidis said the results are a "significant positive" for Vivus because they provide more evidence of Qsymia's effectiveness and tolerable side effects as well as the health benefits from weight loss associated with the drug. He said the data could help expand insurance coverage for Qsymia, boosting sales.

Simeonidis rates Vivus Inc. shares "Outperform" with a price target of $19.

Qsymia went on sale more than a year ago, and early revenue has not lived up to Wall Street's expectations. First Manhattan Co., the largest shareholder in Vivus, moved to replace the company's board to change its strategy. First Manhattan took majority control of the board in July. Leland Wilson stepped down as CEO of Vivus and was replaced by Anthony Zook, who a former AstraZeneca executive First Manhattan had supported.

Zook resigned from the company in early September because of a health problem. Former Johnson & Johnson executive Seth H.Z. Fischer replaced Zook as CEO.

The company's stock lost a penny to $10.12 on Wednesday. The stock has lost more than half of its value in the past year.