Vivus Inc said its obesity drug Qsymia will now be covered by the largest U.S. pharmacy benefits manager Express Scripts Holding Co, giving more people access to the drug and reducing costs for patients.
Express Scripts added Qsymia as a standard benefit option to its national formulary, which means patients will now pay about $50 to $60 as their co-payment on a monthly prescription of Qsymia, or about one-third of the retail price.
The drug is currently available only through mail-order pharmacies for an average retail price of $160.
Vivus's Chief Commercial Officer Mike Miller said last month that about 30 percent of patients receiving a Qsymia prescription did not buy the drug because of the cost.
Vivus's shares rose 8 percent to a high of $14.71 in early trade on the Nasdaq.
"We believe that it is a positive sign for longer-term success on the reimbursement that Vivus has been able to make these inroads during the first three months of the launch," Cowen & Co analyst Simos Simeonidis wrote in a note.
The analyst, however, maintained his "neutral" rating on the stock, saying it was unclear how many people would benefit from Express Scripts' policy change.
Initial sales of Qsymia, one of the two new diet pills approved earlier this year after a dry spell of 13 years, were weak largely due to the lack of reimbursement coverage for the drug.
Lackluster sales also prompted investor activism against Vivus, with its top shareholders calling for a sale of the company.
However, the third-largest U.S. health insurer Aetna Inc last month said it would provide coverage for both diet pills - Qsymia and Arena Pharmaceuticals Inc's Belviq.
(Reporting by Esha Dey and Zeba Siddiqui in Bangalore; Editing by Roshni Menon)