The Story. VIVUS (NASDAQ:VVUS) FDA approved obesity drug, Qsymia, has better efficacy in terms of more weight reduction than Belviq, Contrave, and Orlistat. Nonetheless, the FDA labeled warning of birth defects could eliminate a large number of childbearing-age patients. This potentially limits Qsymia's sales as nearly half of the pregnancies in the US are unplanned. Nonetheless, VIVUS could offset Qsymia potential revenue decline as well as to to increase earnings drastically by also focusing their marketing and sales toward men suffering from obesity. As for VIVUS' competitor, Arena Pharmaceuticals (NASDAQ: ARNA) share price has declined significantly since last year creating a wider margin of safety. 

More Insights. Even if we hypothetically exclude Qsymia, Vivus could still be a prudent investment, if and only if Stendra sales take off. Stendra (or generic avanafil) is a highly efficacious phosphodiesterase 5 (or PDE 5) inhibitor use to treat erectile dysfunction.  In phase 3 clinical trials, Stendra demonstrated similar to better efficacy and safety versus its blockbuster competitor, Viagra.  Perhaps, the superb trial data enabled VIVUS to easily secured partnerships for avanafil back in 2013.

Source: VIVUS

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