Orexigen Therapeutics Receives $15 Million Milestone Payment

Takeda is Orexigen’s U.S. partner for Contrave, which is indicated for use as an adjunct to a reduced-calorie diet and increased physical activity for chronic weight management in obese and overweight adults.

Orexigen also announced receipt of the $7 million upfront payment from Kwang Dong Pharmaceutical, based in Seoul, Korea. In August 2015, Orexigen and Kwang Dong executed a Korean distributorship agreement for Contrave. Kwang Dong expects to begin marketing Contrave in the second half of 2016, if regulatory approval is obtained.

Orexigen CEO Mike Narachi said:

As we make progress in the global commercialization of Contrave / Mysimba, we expect a growing revenue stream of upfront and milestone payments as well as royalty and product sales income from currently established and potential future collaborations.

Orexigen expects to end 2015 with approximately $190 million to $200 million in cash and cash equivalents. The most recent quarterly report only listed $71.6 million in cash and cash equivalents; short-term investments totaled $103.5 million.

So far in 2015, Orexigen shares have underperformed the market. The stock is down 60% year to date and down nearly 47% in the past 52 weeks.

Shares  closed Tuesday flat at $2.40 . In early trading indications Wednesday, shares of Orexigen were up 7.1% at $2.57. But shortly after the opening bell they were flat at $2.40, on a 52-week trading range of $2.19 to $9.37. The stock has a consensus analyst price target of $11.00.

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