UPDATE 3-Arena weight-loss trial yields mixed results

* Results fall short of one FDA guideline

* But 47.2 pct of lorcaserin patients lose at least 5 pct

* FDA filing planned for December

* Shares rise 13 pct after initial plunge
(Recasts, adds analyst comments, updates share movement, adds
NEW YORK to dateline)

By Deena Beasley and Ransdell Pierson

LOS ANGELES/NEW YORK, Sept 18 (Reuters) - Arena
Pharmaceuticals Inc's (ARNA.O) obesity drug produced mixed
results in a second late-stage trial, sending the company's
shares on a roller coaster in furious trading on Friday.

As happened in an earlier trial, the study of Arena's
lorcaserin fell short of a U.S. Food and Drug Administration
guideline calling for a 5 percentage point improvement in
weight loss between the test drug and a placebo.

But Arena said the 4,000-patient trial satisfied the FDA's
alternate requirement by showing 47.2 percent of subjects on
the oral drug lost 5 percent or more of their weight, compared
with 25 percent of placebo patients achieving that goal.

Although the weight-loss data might not seem impressive at
first glance, Summer Street Research analyst Carol Werther said
it was "very positive."

Werther noted the top 25 percent of patients who responded
to lorcaserin achieved extremely good weight loss -- shedding
more than 35 pounds.

Rival experimental products such as Vivus Inc's (VVUS.O)
Qnexa combine two drugs, Werther said. Patients taking Qnexa
lost an average of 37 pounds, or 14.7 percent of their body
weight, in two late-stage trials unveiled earlier this month.

"Lorcaserin is a single-agent, so it's been at risk for not
looking as good as competitors that are dual-acting, but some
patients responded very well," said Werther. She stuck by her
prior forecast of $1 billion in annual lorcaserin sales.

The wild ride for Arena shares began after the company said
late on Thursday it would unveil the data on Friday morning.

Shares soared as much as 38 percent to $6.77 in after-hours
trading on Thursday, but then changed direction when Arena
released the results overnight and analysts were initially
underwhelmed with the weight-loss data.

But spirits rose after investors digested comments made by
company executives during a conference call on Friday, where
additional efficacy data was discussed.

Shares of Arena were trading at $5.55 in afternoon trading
on Friday, up 13 percent from the Nasdaq close of $4.91 on
Thursday. About 77 million shares had exchanged hands at mid
day, nearly all of Arena's outstanding shares.

The year-long trial found that obese patients taking
lorcaserin twice a day, on average, lost 5.9 percent of their
body weight, compared with 2.8 percent for patients taking a
placebo -- a difference of 3.1 percentage points.

Arena plans to seek U.S. approval in December.

"We met the second of those two alternate efficacy end
points," Arena Chief Executive Jack Lief said. "Lorcaserin
allows patients to lose weight early in treatment and to stay
on that treatment."

Arena said the incidence of side effects, like upper
respiratory infection and headache, was similar between the
lorcaserin and placebo groups. Lorcaserin also was not
associated with psychiatric side effects, such as depression
and suicidal thoughts, or with heart valve problems.

That is key since lorcaserin works in a way similar to
fenfluramine, which was part of the fen-phen diet cocktail
before it was withdrawn in 1997 after being linked to heart
valve damage.

Arena's drug is designed to block appetite signals in the
brain, but by being much more selective in the receptors it
affects than fenfluramine, which also binds to a separate cell
receptor in the heart.

With about two-thirds of Americans classified as obese or
overweight, a viable weight-loss drug is expected to have
blockbuster sales.

Vivus (VVUS.O) and Orexigen Therapeutics Inc (OREX.O) are
also close to filing for regulatory approval of their new
obesity drugs. Vivus shares were up 10 percent on Friday.

Money managers Federated Investors and Wellington
Management Company rank among the top shareholders in Arena,
according to Reuters data.

Not all investors were betting on Arena's success. Short
interest representing bearish bets in Arena amounted to about
15 percent of its shares outstanding as of Aug. 31.

Arena, which is seeking a partner to sell the drug, plans
to present detailed lorcaserin trial data in October at a
meeting of the Obesity Society in Washington.
(Additional reporting by Lewis Krauskopf; Editing by Lisa Von
Ahn, Dave Zimmerman, editing by Matthew Lewis)