Vivus Falls After 3Q Report
Ahead of the Bell: Vivus falls after 3Q report
Nov. 6, 2013 (AP) - Shares of Vivus Inc. fell Wednesday before markets opened after the drug developer reported disappointing sales of its obesity treatment Qsymia.
The Mountain View, Calif., company said Tuesday after markets closed that Qsymia brought in $6.4 million in revenue for the quarter that ended Sept. 30. Qsymia went on sale more than a year ago, and early revenue has not lived up to Wall Street's expectations because of limited insurance coverage and high out-of-pocket costs.
Prescription growth is outstripping revenue growth for Qysmia, said Brean Capital analyst Jonathan Aschoff in a research note, because many prescriptions include a free or discounted offer. He said that he believes the company will continue to use pricing incentives amid stiff competition.
The analyst has a "Sell" rating on Vivus and lowered his price target for the shares to $5 from $6.
The stock fell 61 cents, or 6.5 percent, to $8.80 in premarket trading. The stock has dropped 30 percent this year.
Overall, the drugmaker's quarterly loss widened to $48.2 million, or 48 cents per share. That compares with a loss of $40.4 million, or 40 cents per share, in last year's quarter.
The company said it would cut about 20 employees, or 17 percent of its workforce, as part of a push to reduce expenses not essential to expanding the use of Qsymia. CEO Seth H.Z. Fischer said Qysmia revenue grew "modestly" in the quarter, but the company believes expanded reimbursement coverage and other tools will help sales increase next year.
Posted: November 2013