Orexigen Therapeutics reports net loss of $15.0M for three months ended December 31, 2009

Mar 9 2010

Orexigen® Therapeutics, Inc. (Nasdaq: OREX), a biopharmaceutical company focused on the treatment of obesity, today announced financial results for the three months and year ended December 31, 2009.

Three months ended December 31, 2009

As of December 31, 2009, Orexigen held $37.7 million in cash and cash equivalents and an additional $54.5 million in investment securities, available-for-sale.  Together, these amounts total $92.2 million.

For the three months ended December 31, 2009, Orexigen reported a net loss of $15.0 million, or $0.32 per share attributable to common stockholders, as compared to a net loss of $22.1 million, or $0.64 per share attributable to common stockholders, for the same period in 2008.  

Total operating expenses for the three months ended December 31, 2009 were $14.8 million compared to $22.1 million for the same period in 2008.  The decreased operating expenses were due primarily to a decrease in research and development expenses of $8.7 million related to the completion of our Contrave® Phase 3 clinical trials and completion of our Phase 2 clinical trial for Empatic™, offset partly by an increase in general and administrative costs of $1.3 million due principally to increases in salaries and personnel related costs, marketing and consulting expenses and medical affairs expense.  

Year ended December 31, 2009

For the year ended December 31, 2009, Orexigen reported a net loss of $66.6 million, or $1.67 per share attributable to common stockholders, as compared to a net loss of $93.2 million, or $2.76 per share attributable to common stockholders, for 2008.  

Total operating expenses for the year ended December 31, 2009 were $65.6 million compared to $94.9 million for 2008.  The decreased operating expenses were due primarily to a decrease in research and development expenses of $31.8 million related to the completion of our Contrave Phase 3 clinical trials and completion of our Phase 2 clinical trial for Empatic, offset partly by an increase in general and administrative costs of $2.5 million due principally to increases in salaries and personnel related costs, medical affairs expense, recruiting expense and public relations costs.

"Orexigen has made significant progress in the past year that positions us for our transformation to a commercial enterprise," said Michael Narachi, President and CEO of Orexigen.  "We completed our Contrave Phase 3 Program and our Empatic Phase 2 program, both with very positive results, and have nearly completed all sections of our New Drug Application for Contrave, which we expect to file with the FDA by the end of April.  In addition, we raised additional capital which has allowed us to advance our preparations for a targeted commercial launch, and to outline the value proposition for potential partners that would enable access to the broader primary care markets."

2009 Highlights

• Orexigen made a number of key additions to its management team and staff, which will help position the Company for long term regulatory and commercial success.  In April, Orexigen announced that it appointed Michael Narachi, a 20 year veteran of Amgen, as President and Chief Executive Officer.  Later in the year, the Company announced a number of other strategic hires:  Jay Hagan as Head of Corporate Development and Strategy, Mark Booth as Chief Commercial Officer, Dawn Viveash M.D. as Head of Global Regulatory Affairs, Suzanne McDonald as Head of Managed Markets and Government Affairs, Preston Klassen, M.D., MHS as Head of the Global Contrave Program and Whedy Wang, Ph.D., MPH as Head of Global Biomedical Information.  

Contrave

Orexigen announced the results of all four of its Phase 3 trials in the Contrave Obesity Research, or COR, program in 2009.  Each trial met its co-primary endpoints. Data from these trials demonstrated the following:

• In the COR-I and COR-II trials, approximately 48% and 56% of patients on Contrave32 lost at least 5% of their body weight after 56 weeks on an intent-to-treat basis, as compared to placebo patients who lost approximately 16% and 17% (p<0.001).  Additionally, approximately 34% to 48% of patients who completed one year of therapy on Contrave32 in these two trials lost at least 10% of their baseline body weight.
• In the COR-BMOD trial, which incorporated an intensive diet and exercise behavior modification regimen, approximately 55% of patients who completed one year of therapy on Contrave32 lost at least 10% of their baseline body weight.
• In the COR-Diabetes trial, patients with type 2 diabetes taking Contrave lost significantly more weight than patients on placebo, and they also achieved substantial improvements in glycemic control.  Specifically, Contrave patients showed a 0.6% reduction in hemoglobin A1c (HbA1c) from baseline, compared to a 0.1% reduction in placebo.
• Key secondary endpoints met across the entire COR Phase 3 program included significant improvements in markers of cardiometabolic risk such as waist circumference, HDL cholesterol and triglycerides.  Additional analyses indicate that Contrave patients experienced an increased ability to control their eating compared to placebo.
• Contrave was generally well tolerated by patients across the COR Phase 3 program. The most frequently observed treatment-emergent adverse events were nausea, constipation and headache. Nausea was the leading adverse event resulting in discontinuation; however, for the majority of patients experiencing nausea, it was mild to moderate, transient and manageable.

The results from the successfully completed COR program of more than 4,500 patients exceed the FDA categorical efficacy benchmark for clinically significant weight loss, supporting the Company's plan to file a New Drug Application with the FDA by the end of April

Empatic

In September, Orexigen announced the data from the Phase 2b clinical trial of Empatic.  The results of this trial demonstrated the following:

• Patients completing 24 weeks of Empatic360 (bupropion SR 360mg/zonisamide SR 360 mg) therapy lost 9.9% of their baseline body weight compared to 1.7% for placebo patients (p<0.001).  Importantly, mean weight loss for patients on Empatic continued to decline through the endpoint of the trial, with no evidence of a weight loss plateau.  
• Improvements were observed in key markers of cardiometabolic risk, such as waist circumference, triglycerides, fasting insulin and blood pressure, compared to placebo.  
• The most commonly reported adverse events, as well as those leading to discontinuation, for all Empatic patients were headache, nausea and insomnia.  Adverse events and laboratory findings appeared to be consistent with the individual components of Empatic.  There were no statistically or clinically meaningful differences between Empatic and placebo on measures of cognitive function, depression, suicidality or anxiety.

Corporate

• In July, the Company completed a public offering of 11.5 million shares of common stock at $7.50 per share, which resulted in net proceeds to the Company of approximately $81.6 million.