Weight loss: EnteroMedics shares tank after device "fails" study

February 11, 2013 by MassDevice staff

Weight loss devices maker EnteroMedics loses half of its Wall Street value after its VBloc vagal blocking therapy system fails to meet endpoints in a pivotal trial.

EnteroMedics' Maestro VBloc system

Wall Street fled in droves after weight-loss devices maker EnteroMedics (NSDQ:ETRM) announced that its Maestro vagal blocking system failed to meet endpoints in a pivotal study, but the mass exodus isn't discouraging the company from moving forward with a bid for FDA approval.

Treatment with Maestro therapy didn't hit targets in the ReCharge study, but rates of excess weight loss combined with the demonstrated safety profile of the neurostimulation implant may be enough to get the device through the premarket approval process, the company reported.

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"Even though we did not reach the predefined efficacy thresholds, data from the ReCharge trial clearly demonstrate VBloc Therapy's positive effect on weight loss, while adding to an excellent safety record," EnteroMedics president & CEO Mark Knudson said in prepared remarks. "Based on these compelling results, and the totality of our clinical experience with the Maestro System, which now includes more than 600 patients worldwide, we believe EnteroMedics is well positioned to deliver this novel therapy to people with obesity in the U.S."

"We are moving forward with a PMA application to the FDA, in addition to advancing our plans for pursuing other indications, including obesity-related diabetes and hypertension, outside the U.S.," Knudson added.