Vivus reports nearly 80 percent drop in profit

MOUNTAIN VIEW, Calif. - Drug developer Vivus Inc. reported a nearly 80 percent decline in third-quarter profits Tuesday, falling short of Wall Street expectations because of increased spending on developing an obesity drug.

The company said rising costs were offset somewhat by deferred revenue from the 2007 sale of Evamist, a spray-on hot flash treatment.

Vivus posted net income of $266,000, or break-even per share, compared with $1.3 million, or 2 cents per share, for the same period last year.

Revenue rose to $25.5 million from $19.1 million a year earlier.

Analysts polled by Thomson Reuters anticipated earnings of 1 cent per share on $24.9 million in revenue.

Operating expenses surged in the third quarter to $22.6 million from $15.1 million a year earlier, primarily because the company spent more on clinical trials for experimental obesity drug Qnexa, which is in late-stage trials.

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