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SEC Filings

S-1/A
OREXIGEN THERAPEUTICS, INC. filed this Form S-1/A on 02/16/2007
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Table of Contents

agreement generally extends until December 31, 2007. However, we may terminate the agreement upon 30 days written notice.
 
The University of Iowa produces our bupropion SR formulation using bupropion active pharmaceutical ingredient, or API, from Solmag S.p.A. Recently, the University of Iowa advised us that it will no longer be able to meet our supply requirements for bupropion SR due to its limited manufacturing capacity. The University of Iowa advised us that it will supply up to six additional batches of bupropion SR, which we believe will be sufficient to meet our requirements for our Contrave and Excalia clinical trials through mid 2007. While we do not have alternate manufacturing plans in place at this time, we believe that there are other manufacturers capable of producing our bupropion SR needs within the time frames we will require. We have entered into negotiations with an alternative manufacturer for future supplies of bupropion SR. We will need to demonstrate comparable bioavailability and bioequivalence of the bupropion SR formulation used in clinical trials to date to the bupropion SR formulation we will use going forward.
 
Pharm Ops, Inc. and QS Pharma, LLC produce our SR and IR naltrexone requirements using API supplied by Diosynth. Pharm Ops, Inc. also produces our zonisamide SR using API from ChemAgis. Our tablets are produced for us by Pharm Ops, Inc. and we utilize the services of Almac Clinical Services to package our clinical supplies into Contrave Titration Packs, Excalia Titration Packs and bottles for use in our clinical trials. To date, all of our contract manufacturers have performed services under short-term purchase order or similar arrangements. We have no long-term commitments or supply agreements with these contract manufacturers.
 
In the future, if we are able to achieve approval in the United States or other countries to market and sell our products, we intend to continue to rely on outside contractors for the production of necessary supplies. We do not currently intend to establish our own manufacturing capabilities.
 
Competition
 
Treatments for obesity consist of behavioral modification (diet and exercise), pharmaceutical therapies, surgery and device implantation. Modifications to diet and exercise are the preferred initial treatment in obesity. However, the demands of behavioral modification tend to cause significant attrition over time and, frequently, suboptimal weight loss outcomes. When pharmaceutical therapies are recommended it is generally after behavioral modification alone has failed. Bariatric surgery, including gastric bypass and gastric banding procedures, is employed in more extreme cases, typically for patients with a BMI exceeding 40 or who are experiencing obesity-related complications such as diabetes. Surgery can be effective in helping patients to lose 50% or more of their body weight. However, surgery is associated with significant side effects, potential complications and high costs. In addition, while surgery may be effective in achieving weight loss, recent reports have cited “addiction transfer,” where patients begin heavy alcohol consumption, drug use or other addictive habits in response to the reduced ability to consume food, including the October 2006 issue of Bariatric Times. Device implantation is a newer therapy which has yet to be widely adopted within the medical community.
 
Several pharmaceutical products are approved for marketing in the United States with an obesity indication. These pharmaceutical products generally are prescribed for short-term use; fewer agents have been approved for longer-term maintenance therapy. Several older agents, indicated for short term administration, are amphetamine-like compounds including phentermine, phendimetrazine, benzphetamine and diethylpropion. Of these, phentermine is the most widely used, accounting for approximately 3,059,000 prescriptions in the United States in 2005, or approximately $44 million in sales, according to IMS Health.
 
Sibutramine is marketed in the United States by Abbott Laboratories under the brand name Meridia. Sibutramine appears to suppress appetite by inhibiting the reuptake of serotonin, norepinephrine and dopamine in the brain. In 2005, Meridia accounted for approximately 535,000 prescriptions in the United States, or approximately $56 million in sales, according to IMS Health.
 
Orlistat is marketed in the United States by Roche Laboratories, Inc. under the brand name Xenical. Orlistat works by inhibiting lipase, an enzyme that blocks the absorption of fat in the gastrointestinal tract. In


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