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Vivus Diet Pill Sales Rise Rapidly Early in Launch

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Analyst predicts that it will take some time before Qsymia records meaningful revenue. Cowen's Simeonidis predicts $1.6 billion in sales by 2019.

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MINYANVILLE ORIGINAL Diet pill maker Vivus (NASDAQ:VVUS) saw demand rise substantially for its weight-loss drug Qsymia in the second week on the market and some insurers appear to be covering the product.

The sales figures were a cause for celebration among investors, at least for a short spell. Shares of Vivus rose 10% Monday. The stock is up another 2% Tuesday, trading at $20.86 late morning.

With the hype around recently approved diet drugs from Vivus and rival Arena Pharmaceuticals (NASDAQ:ARNA), sales figures will certainly be a significant guidepost for investors. Both stocks enjoyed big rallies this year. Vivus shares more than doubled, while Arena jumped 370%. Arena's drug, Belviq, is approved by the US Food and Drug Administration but is still being reviewed by the US Drug Enforcement Administration because of potential for abuse. The pill is expected to be on the market by late this year or early 2013. Arena's development partner, Japanese drugmaker Eisai, will sell Belviq.

Two drug-tracking companies, IMS Health and Wolters Kluwer, reported substantial gains for Qsymia in the second week of sales, which ended September 28. The numbers vary quite a bit and it should be noted that these are quite early figures.

According to Cowen & Co. analyst Simos Simeonidis: IMS reports 933 new prescriptions compared with 236 the first week, and Wolters Kluwer said there were 581 new prescriptions vs. 106 the first week.

"Even though we believe it is too early in the launch to call anything a trend, we see the four- and five-fold increase in the IMS and Wolters Kluwer numbers as a positive early sign for Qsymia's demand," Simeonidis says.

So why does the analyst have a hold rating on the stock?
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No positions in stocks mentioned.
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