San Diego’s Arena Pharmaceuticals Inc. will receive $65 million in milestone payments from Japanese pharma company Eisai Inc. after receiving U.S. Drug Enforcement Administration approval of its weight loss drug, Belviq. This approval will allow the drug to be sold on the U.S. market.
The DEA will officially designate Belviq a Schedule IV controlled substance in about a month’s time, meaning it has a relatively low potential to be addictive in patients.
Shares for the company, whose market cap is $1.81 billion, rose 11 percent, trading at $8.34 at market close.
Belviq was approved in June 2012 by the U.S Food and Drug Administration — the first anti-obesity drug approved by the FDA since 2000.
Eisai is responsible for the marketing and distribution of Belviq in the U.S. It is manufactured by Arena in its Switzerland facility, and sells the finished commercial product to Eisai for a purchase price starting at 31.5 percent of Eisai’s annual net product sales, the company said in a statement.
Arena is eligible to receive $1.16 billion based on annual net sales levels of Belviq, the company said.
— Meghana Keshavan