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SEC Filings

S-1/A
OREXIGEN THERAPEUTICS, INC. filed this Form S-1/A on 04/09/2007
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and if Cypress does not undertake action within three months of having been made aware of infringing activity, the right to commence suit ourselves at our expense.
 
As a result of our sublicensing of the Duke technology to Cypress for specified uses, we may be required to make future payments to Duke of up to $5.7 million upon Cypress’s achievement of various regulatory milestones.
 
Manufacturing
 
To date, our products used in clinical trials have been produced by outside contractors under our supervision. PharmaDirections is our primary drug development consultant and manages subcontractors on our behalf.
 
In December 2005, we entered into a consulting agreement with PharmaDirections under which PharmaDirections agreed to serve as our primary drug development consultant managing subcontractors on our behalf and assisting us with certain initiatives, including new formulation development, management of our chemistry, manufacturing and control function, coordination of our regulatory function and pre-clinical/Phase I research, among others. Under this agreement, we pay fees to PharmaDirections on a per-project basis as approved on corresponding work orders. This agreement was amended in January 2006. The term of this agreement generally extends until December 31, 2007. However, we may terminate the agreement upon 30 days written notice.
 
The University of Iowa has provided 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 Empatic clinical trials through mid 2007. We have arranged to transfer the manufacturing process from the University of Iowa to Pharmaceutical Manufacturing Research Services Inc., or PMRS, and Patheon Pharmaceuticals Inc., or Patheon. PMRS will provide bupropion SR for our Contrave Phase III clinical trials on a purchase order basis. Patheon will manufacture bupropion SR and finished Contrave tablets for our Contrave Phase III clinical trials on a proposal by proposal basis under a master agreement for pharmaceutical development services that we entered into in February 2007. We currently expect to pay Patheon approximately $2.5 million for the manufacture of clinical supplies. Either party may terminate the agreement upon notice if the other party commits a material breach of its obligations and fails to remedy the breach within 30 days. In addition, we may terminate the agreement immediately for any business reason.
 
Pharm Ops, Inc. produces our SR and IR naltrexone requirements using API supplied by Diosynth. Pharm Ops, Inc. also produces our zonisamide SR using API from ChemAgis. In addition, Pharm Ops, Inc. currently produces our finished Contrave tablets, and we utilize the services of Almac Clinical Services to package our clinical supplies into Contrave Titration Packs, Empatic 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,


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