Orexigen was expected to receive a decision for FDA approval today, Wednesday June 11, 2014 but instead the company got a letter stating that their PDUFA date will now be pushed back all the way to September 11, 2014. That is a significant move back at least 3 months, in response investors are reacting as the stock has now fallen by more than 15% in pre-market trading session. 

We believe that it will be a buying opportunity after a few days because investors/traders that don't have the patience will dump the stock. Like we have stated though, investors should wait a few days for the share price of Orexigen to stabilize before dipping in to ensure getting in at an even better price. This delay, while unfortunate, doesn't come as an outright rejection by the FDA. The FDA stated, according to Orexigen's press release, that the FDA needs additional time to reach an agreement on the post marketing obligation for Contrave. 

In essence this indicates that the FDA and Orexigen have to come to some type of understanding on the post marketing needed for approval of Contrave on the market. Orexigen's Contrave drug was rejected back in 2011 over safety concerns about patients' cardiovascular health while taking the drug compound. We feel that Orexigen will have the advantages of having a label added to its drug compound upon approval since the company ran a large trial with 8,900 patients. This test known as the Light Trial was initiated to appease FDA concerns that Contrave is not an "abomination on cardiovascular health." 

With this safety data on hand, and a slight push back because the FDA needs more time, we feel that Orexigen is still a great buy. As we caution investors should wait for the share price to tumble over the next few days because it will fall due to today's news. OREX has a strong drug compound that greatly increases patient weight loss while providing great safety. In the meantime today, Arena Pharmaceuticals (ARNA) and Vivus (VVUS) should trade higher because of this delay, so that is another trade to keep an eye on. We believe though that OREX will eventually offer traders/investors an opportunity to capitalize on this delay and make some money in the long run.