NEW YORK (AP) — Shares of Vivus Inc. declined Wednesday after the drugmaker reported disappointing second-quarter sales of its obesity drug Qsymia.
THE SPARK: Vivus said Tuesday that it filled 81,000 prescriptions for Qsymia during the second quarter, and its revenue totaled $5.5 million. Analysts expected $7.6 million in revenue, according to a survey by FactSet.
The Mountain View, Calif., company said it lost $55.5 million, or 55 cents per share, in the second quarter. A year ago, it took a loss of $24 million, or 24 cents per share.
Analysts had forecast a loss of 48 cents per share.
THE BIG PICTURE: Vivus started selling Qsymia in September, and so far sales have not lived up to Wall Street's expectations. Insurance coverage for Qsymia has been limited and out-of-pocket costs for patients are high. At first Qsymia was only available through mail order, which also limited sales. Starting July 1 the drug became available at about 8,000 Walgreen Co. and Costco Wholesale Corp. pharmacies. Vivus said patients can now buy Qsymia at around 10,000 locations.
Earlier this year First Manhattan Co., Vivus' biggest shareholder, moved to replace the company's board of directors. In July the two sides settled their dispute. Former AstraZeneca executive Anthony Zook was named Vivus' CEO as part of the settlement, and the company's annual meeting has been adjourned to Aug. 14.
THE ANALYSIS: Cowen & Co. analyst Simos Simeonidis said Zook "has his work cut out for him." Simeonidis said the availability of Qsymia in pharmacies should help its growth, but sales are still not living up to expectations and the company's spending continues to rise. Vivus' selling, general and administrative costs nearly tripled to $42.7 million and total operating costs more than doubled.
SHARE ACTION: Vivus shares lost 75 cents, or 5.1 percent, to $13.98 in midday trading. Earlier the stock fell as much as 6.5 percent.