Eisai launches new savings card for Belviq – January 23, 2015

This past Tuesday, Eisai launched a new savings card for its obesity drug Belviq (lorcaserin; partnered with Arena) as announced in Arena’s Form 8-K. This news, timed to align with the current seasonal focus on weight loss, was also anticipated by a recent press release from Arena and Arena’s presentation at the JP Morgan Healthcare Conference last week. The new savings card specifically targets eligible patients without commercial coverage, enabling them to pay no more than $75 for each monthly prescription of Belviq. In addition, patients with commercial coverage can use this card to save up to $75 per month if their copay is greater than $50 per monthly prescription. However, patients eligible for state or federal healthcare programs (e.g. Medicare, Medicaid, etc.) are still excluded from the new savings card, as is the case with savings programs for other obesity drugs.

In terms of revenue, Arena’s Form 8-K noted that the launch of the savings program, along with the obesity market’s seasonality (i.e. slower sales during the holiday season), may lower Belviq’s reported 4Q14 sales by 35%-45% compared to 3Q14’s $16.8 million. This immediate impact is largely due to Arena/Eisai’s method of calculating revenue for Belviq and appears unlikely to be indicative of sales in future quarters. According to IMS Health estimates, Belviq prescriptions grew by ~4% in 4Q14 (compared to 3Q14’s 30% increase) while overall obesity drug prescriptions decreased by ~4%. Moving forward, Arena expects Belviq prescriptions to further increase in 1Q15 thanks to the savings card and the arrival of “weight loss season,” which should help blunt the impact of lower net prices. While these 4Q14 estimates may be a bit depressing (Eisai’s 4Q14 update will take place on January 30), we believe that Belviq’s recent strong performance (70% sequential growth in 3Q14) indicates that patients and providers are very receptive to the product, which should position Arena and Eisai well over the long term. Particularly given the widespread concerns over the high cost of branded obesity medications, we believe this new savings program marks an important step toward greater patient access and an expanded market for obesity pharmacotherapy.

• This new savings card brings Belviq’s pricing much closer to the level of Orexigen/Takeda’s Contrave (naltrexone/bupropion), but Contrave’s price point remains the lowest in the obesity market – see the table below for a comparison of savings programs for the three obesity drugs on the market. We have heard significant enthusiasm for Contrave’s pricing advantages since the drug’s launch (see our Obesity Week coverage) and Eisai’s move demonstrates the extent to which price is becoming an increasingly important differentiating factor in the obesity market. While we are glad to see companies making these medications more accessible, the costs still remain prohibitive for many patients; we hope that increased awareness and uptake of obesity medications will pave the way for even better reimbursement in the coming years. The Endocrine Society’s recent guideline on obesity pharmacotherapy should certainly help by encouraging more providers to prescribe these medications – as obesity KOL Dr. Donna Ryan (Pennington Biomedical Research Center, Baton Rouge, LA) put it, “the more physicians prescribe, the better the reimbursement, and eventually, the lower the co-pay.”  Bottom line, having larger companies with bigger resources available will help, but doctors and patients now also have to show that the medicines will be used.
• For its part, Vivus has indicated that the company believes Qsymia (phentermine/topiramate) is “priced right for the value we provide” and does not anticipate significant price reductions in the near future.  During Vivus’ breakout session at the JP Morgan Healthcare conference, CEO Mr. Seth Fischer expressed confidence in Qsymia’s clinical profile and continued strong performance, though he did acknowledge that the company could eventually be forced to consider price reductions if lower prices appeared to be driving rapid uptake of other anti-obesity agents.

Table 1. Obesity Drugs’ Savings Programs

-- by Melissa An, Emily Regier, and Kelly Close