US approval for Enteromedics’ expensive weight loss shocker

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The FDA has long faced calls to loosen its standards when it comes to medical device approvals, but when it says yes to an implanted neuromodulator that failed in its pivotal trial it is worth wondering whether it has gone too far in the other direction.

It is true that the product in question, EnteroMedics’ Maestro, is the first new device to treat obesity since 2007 and true too that an adcom backed it, though not unanimously. But the agency was also swayed by a survey showing that patients would accept the risks of surgery and other side-effects to achieve the magnitude of weight loss Maestro promises. Will they be willing to pay for a device that costs around $20,000?

That, for now, is the only way patients will get it. EnteroMedics will have to present evidence of the product’s safety, efficacy and cost-effectiveness to win the backing of payers, and it can only get these data by following the 100-plus patients in the postmarketing trial the FDA has called for, plus those patients who are willing to pay out of pocket.

Patient preference

It is tricky to judge how big this potential pool will be at first. The device is approved for use in adults with a BMI of at least 40kg/m2, or 35kg/m2 with an obesity-related condition such as diabetes. Patients must also have been unable to lose weight in a supervised weight-management programme within the past five years.

These patients can expect to lose around a quarter of their excess weight, going by the results of Maestro’s phase III trial (Trial miss gives EnteroMedics a jolt, but approval push continues, February 11, 2013). Gastric bypass surgery, which costs about the same amount as Maestro, allows patients to lose around 70% of their excess body weight, but involves greater risk – the surgery is far more involved than the implantation procedure for Maestro.

This is sufficient weight loss to be appealing to patients, according to the FDA itself. The agency sponsored a survey of patients’ opinions of obesity devices and concluded that they would accept Maestro’s risk-benefit profile.

Reimbursement is still EnteroMedics’ endgame, of course, but with a smallish initial market this will take time.

The US Centers for Disease Control and Prevention says around 79 million US adults have a BMI above 30 and are therefore obese. But obesity is more common among older and poorer people; factoring in the ability to fork out $20,000, and the narrow indication for which Maestro is cleared, cause this pool to shrink considerably.

According to EvaluateMedTech’s consensus forecasts, the system will do $8m of business in 2015, rising to $185m in 2020; most analysts expect reimbursement to come through in 2017.

EnteroMedics’ shares closed 19% up at $1.40 yesterday, having spiked to nearly $2 in morning trading. Investors might be wiser to wait for news of insurance coverage, and Medicare and Medicaid in particular, before piling in.

To contact the writer of this story email Elizabeth Cairns in London at elizabethc@epvantage.com or follow LizEPVantage on Twitter

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