November 21, 2012 / 5:31 PM / in 5 years

Vivus, Arena shares jump on insurance coverage for diet pills

(Reuters) - Health insurer Aetna Inc (AET.N) said it would provide coverage for Vivus Inc’s (VVUS.O) and Arena Pharmaceuticals Inc’s (ARNA.O) diet pills, sending the obesity drugmakers’s shares up.

The decision by the third-largest health insurer to provide coverage for Vivus' Qsymia and Arena's Belviq may boost adoption of the diet pills.

Vivus reported lackluster initial sales of Qsymia earlier this month, citing a lack of reimbursement coverage.

“About 30 percent of patients chose not to fill after receiving a (Qsymia) prescription due to cash outlay,” the company’s chief commercial officer Mike Miller said on a post-earnings conference call on November 6.

Low sales of the much-hyped drug also prompted one of Vivus’s biggest shareholders, QVT Financial LP, to demand the company sell itself. QVT owns 8.3 percent equity stake in Vivus and 1.2 percent in Arena.

Arena’s Belviq was approved by U.S. health regulators in June, making it the first new weight-loss drug to gain approval in 13 years. Vivus’s Qsymia was approved in mid-July.

    Arena expects to launch Belviq by early next year.

    Shares of Vivus were up 14 percent at $11.80 while those of Arena were up 3 percent at $9.22 on Wednesday on the Nasdaq.

    Shares of Orexigen Therapeutics Inc (OREX.O), which is planning to re-submit the marketing application for its obesity pill Contrave, rose 7 percent to $4.66 on the same exchange.

    Reporting by Balaji Sridharan in Bangalore; Editing by Sriraj Kalluvila

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