Our most advanced drug candidate, lorcaserin, is intended for weight management, including weight loss and maintenance of weight loss. According to the Centers for Disease Control and Prevention, more than one-third of US adults were obese in 2009-2010. Studies have shown that a weight loss of 5% to 10% of body weight from baseline can result in meaningful improvements in cardiovascular risk factors (e.g., lipids, blood pressure and blood glucose), quality of life and functional capacity, and a significant reduction in the incidence of type 2 diabetes. There are currently limited pharmaceutical treatment options to help patients lose weight.

Lorcaserin is a new chemical entity that we believe acts as a selective serotonin 2C receptor agonist. The serotonin 2C receptor is expressed in the brain, including the hypothalamus, which is an area involved in the control of appetite and metabolism. In in vitro studies, lorcaserin demonstrated greater affinity and activity at the serotonin 2C receptor than at the serotonin 2A and 2B receptors. Activation of the latter two receptors has been associated with undesirable effects: Activation of the 2A receptor has been associated with central nervous system, or CNS, effects, including altered perception, mood and abuse potential; and activation of the 2B receptor has been associated with cardiac valvulopathy.

We have evaluated the safety, pharmacokinetics and pharmacodynamics of lorcaserin in 19 clinical trials: seven Phase 1 trials, two Phase 2 trials, three Phase 3 trials, a bioavailability study, a mass balance study, an ECG/QT trial, two drug interaction trials, an abuse potential trial, and a study of energy intake and energy expenditure. The lorcaserin Phase 3 clinical trial program consisted of three double-blind, randomized, placebo-controlled trials, BLOOM (Behavioral modification and Lorcaserin for Overweight and Obesity Management), BLOSSOM (Behavioral modification and LOrcaserin Second Study for Obesity Management) and BLOOM-DM (Behavioral modification and Lorcaserin for Overweight and Obesity Management in Diabetes Mellitus), and enrolled approximately 7,800 patients. BLOOM and BLOSSOM evaluated lorcaserin versus placebo in non-diabetic patients who were obese or patients who were overweight and had at least one weight-related co-morbid condition other than diabetes: BLOOM evaluated 3,182 patients over a two-year treatment period; and BLOSSOM evaluated 4,008 patients over a one-year treatment period. BLOOM-DM evaluated 604 obese and overweight patients with type 2 diabetes over a one-year treatment period.

Following one year of treatment, lorcaserin patients achieved statistically significant weight loss and favorable changes over placebo in a variety of parameters associated with cardiovascular and metabolic risk. The most frequent adverse events were headache, nausea, dizziness, fatigue and dry mouth, with headache being the only adverse event increased over placebo by greater than 5%.

In October 2010, the US Food and Drug Administration, or FDA, issued a Complete Response Letter, or CRL, with respect to the lorcaserin New Drug Application, or NDA, we submitted in December 2009. In the CRL, the FDA stated that it completed its review of the NDA and determined that it could not approve the application in its then present form.

After completing various studies, analyses and other activities in response to the lorcaserin CRL, we resubmitted the lorcaserin NDA in December 2011. The resubmission includes data and analyses that were not incorporated in the original NDA, including the results of BLOOM-DM, which was completed after we filed the original NDA. The FDA accepted the resubmission for filing and review and assigned a new Prescription Drug User Fee Act, or PDUFA, target date of June 27, 2012.

The FDA’s Endocrinologic and Metabolic Drugs Advisory Committee met on May 10, 2012, to discuss the lorcaserin NDA. The advisory committee voted 18 to 4, with one abstention, that the available data demonstrate that the potential benefits of lorcaserin outweigh the potential risks when used long-term in a population of overweight and obese individuals.

We are also seeking regulatory approval for lorcaserin in the European Union. On March 2, 2012, we filed a marketing authorization application, or MAA, for lorcaserin through the centralized procedure with the European Medicines Agency, or EMA, and the EMA subsequently accepted the filing. The acceptance of the MAA filing begins the EMA’s review process.

Our wholly owned subsidiary, Arena Pharmaceuticals GmbH has granted Eisai Inc., or Eisai, exclusive rights to commercialize lorcaserin in most of North and South America, including the United States, Canada, Mexico and Brazil, subject to applicable regulatory approval. Also subject to applicable regulatory approval, we intend to commercialize lorcaserin in the European Union and in other areas outside of the United States with one or more collaborators or independently.

We have patents or patent applications that cover lorcaserin in the United States, Europe, Canada, Mexico, Brazil and many other jurisdictions that, if issued, in most cases would be capable of continuing into 2023 without taking into account any patent term extensions or other exclusivity we might obtain.

Our drug candidates have not been approved by the U.S. Food and Drug Administration or any other regulatory agency.