Credit Suisse Bashes Arena Pharma (ARNA)

Jackie Chan - Are you Serious

Credit Suisse downgraded Arena today, what gives?

Interesting that CS chose to downgrade the obesity drug maker on the day of one of the biggest rallies in recent memory. The DOW rose +250 points, the Nasdaq +66 points, and the S&P 500 rose nearly +30 points today.

Shares of Arena were down -5%.

Kalowski, of Credit Suisse, initiated coverage of Orexigen with an Outperform rating and Arena with an Underperform. Kalowski already rates Vivus at Outperform.

Orexigen has a “favorable risk/reward profile around the pre-approval cardiovascular outcomes trial,” and Vivus as recent “concerns relate to matters that are not new.” But Arena’s prospects may not be as promising, says Kalowski.

“ARNA commendably ushered Belviq through FDA; we believe that sales (ARNA has an approximately 35% royalty) will fall short of the market’s lofty expectations,” he wrote.

Mastery Bottom Line

Mr. Kalowski of Credit Suisse must have written this little piece after snorting a fat line of bath salts.

Anyone who has been following Arena for a while knows that the stock has very low institutional ownership. In fact, around the time that Arena received its FDA approval for Belviq, it was approximately 20% institutional-owned. In the last couple of months it has risen to approximately 32%.

Credit Suisse doesn't have a crystal ball and neither do we. No one knows at this point whether doctors will prescribe Belviq more or Qnexa more. Arena has a lower risk profile so we tend to think that Belviq will be prescribed more, but again, we don't have a time machine.

This seems like a pretty blatant attempt from CS to hold the share-price down so intituitions can continue to back up the truck.

Thoughts, anyone?

     In my opinion the Crdit Suisse report has a real bad smell to it and probably is due to a hidden agenda at Credit Suisse.  Perhaps they will handle a secondary for Orexigen and earn large fees.

      Orexigen is over two years away from first re-applying to the FDA for approval.  And approval is far from a given.   Several very concerning issues include Contrave's increase in heart rate and pulse and CNS issues including increase in seizures.  For sure, Orexigen will need a secondary offering in the near future.

      BELVIQ is FDA approved and upon DEA classification within the next several weeks will be ready for marketing by their big pharma partner Eisai.  ARNA has NO debt and is flushed with cash due to milestones received. Not only will they receive approximately 35% of sales but will also receieve up to $1.2 billion of purchase price adjustments.  BELVIQ is clearly the safest weight loss drug with an average 8.2% weight loss of responders and 0.9% reduction in hemoglobin A1!c levels.

You're goddamn right. Thanks for the comment.

CS does not bother to mention or take into account Belviq's A1C lowering ability.  They are not sure that General practitioners will prescribe this drug.  A drug that lowers blood sugar and helps you loose weight with very minimal side effects.  Get a clue.

Kalowski, of Credit Suisse should be pursued by SEC and ultimately jailed. These pesky manipulators are like pests and must be neutralized asap.

Neither Kalowski nor Credit Suisse could posssbly believe what is that opinion.  It is so far removed from reality that it had to have been put out solely for the purpose of manipulating down ARNA's share price. 

Credit Suisse also believes in Santa, the Easter Bunny, and the boogieman.Why anyone would believe them is really sad....