Выбор редакции

Orexigen Plummets on Filing of Chapter 11 of Bankruptcy Code

Shares of Orexigen Therapeutics Inc. OREX crashed further 9% on Mar 12, after plummeting 76% a day before, following the news of the company filing for bankruptcy.

 

Orexigen’s stock has lost 77.5% in the last three months, underperforming the industry’s gain of 2.2%.

On Mar 12, Orexigen announced that it has decided to file a voluntary petition under Chapter 11 of the Bankruptcy Code in the U.S. Bankruptcy Court for the District of Delaware. The company also plans to file a motion seeking authorization to pursue an auction and sale process under Section 363 of the U.S. Bankruptcy Code.

The bidding process is expected to conclude by May 18.

Meanwhile, Orexigen has filed a series of motions with the court thereby seeking to ensure the continuation of normal operations during this tenure. The company also has the support of a controlling number of its senior secured noteholders for this process, who have made a financing commitment of 35 million.

The news comes in the wake of an unimpressive performance of its weight-loss drug Contrave which is marketed as Mysimba in the European Union. The drug was approved by the FDA in September 2014 for use as an adjunct to a reduced-calorie diet and increased physical activity for chronic weight management in adults with an initial body mass index of 30 kg/m2 or greater (obese), or 27 kg/m2 or greater (overweight) in the presence of at least one weight-related comorbid condition (e.g., hypertension, type 2 diabetes mellitus or dyslipidemia).  Accelerated commercialization efforts have increased costs and hurt the company’s profit.

Contrave is Orexigen’s only approved and marketed drug. However, being a late entrant in the obesity market, the drug faced stiff competition from products like Roche’s RHHBY Xenical (orlistat) Novo Nordisk’s NVO Saxenda and Arena Pharmaceuticals’s ARNA Belviq among others.

Zacks Rank

Orexigen has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Breaking News: Cryptocurrencies Now Bigger than Visa

The total market cap of all cryptos recently surpassed $700 billion – more than a 3,800% increase in the previous 12 months. They’re now bigger than Morgan Stanley, Goldman Sachs and even Visa! The new asset class may expand even more rapidly in 2018 as new investors continue pouring in and Wall Street becomes increasingly involved.

Zacks has just named 4 companies that enable investors to take advantage of the explosive growth of cryptocurrencies via the stock market.

Click here to access these stocks >>


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
Roche Holding AG (RHHBY): Free Stock Analysis Report
 
Novo Nordisk A/S (NVO): Free Stock Analysis Report
 
Orexigen Therapeutics, Inc. (OREX): Free Stock Analysis Report
 
Arena Pharmaceuticals, Inc. (ARNA): Free Stock Analysis Report
 
To read this article on Zacks.com click here.
 
Zacks Investment Research