Arena shares shine, briefly, as it presents its case for obesity drug

Yesterday evening shares of Arena Pharmaceuticals ($ARNA) spiked after the biotech company assured its backers that it had submitted new information backing its closely-watched obesity drug lorcaserin. But the sudden surge had largely evaporated by mid-day today, another twist in the topsy-turvy roller coaster ride investors have been on for months now.

Dow Jones reported that Arena is tackling the FDA's concerns about mammary tumors found in a rat study by noting that the drug evidently increased prolactin, a hormone which is possibly linked to tumor development, and that the developer had found a way to block changes in the mammary gland that apparently precede tumors. Investigators also confirmed that the drug binds to one serotonin receptor more than with two others. The drug's influence on serotonin receptors is designed to promote a sense of satiety.

Shareholders may have been at least temporarily satiated by the new drug information themselves, but the jury is still out on whether Arena can talk its way past skeptical regulators without ultimately mounting a new study. The FDA has made it clear that a drug like lorcaserin, which met though did not significantly exceed the agency's weight standards on new drugs, would have to clear a high bar on safety before marketers could set out to sell it for long-term use to millions of people desperate to shed pounds.

Arena maintains that it has met the FDA's demands for additional data and should gain a new deadline for the FDA's next decision soon.

- check out the Arena release
- here's the Dow Jones report

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