Belowed Stock with Potential for Skyrocketing by Year's End
Viking Therapeutics, a biopharmaceutical company, is making waves in the competitive weight loss market with its candidate, VK2735. However, the path isn't without its hurdles.
The current market expectations for VK2735 are cautiously optimistic, following a setback with Eli Lilly's orforglipron in phase 3 studies. In a phase 2 trial, VK2735 showed a mean weight loss of approximately 12.2% at the highest dose, which, while comparable, is slightly less than orforglipron's 12.4% in a larger phase 3 study for obese or overweight patients without diabetes.
However, the key concern with VK2735 is its poor tolerability. Around 20-38% of patients discontinued due to adverse gastrointestinal effects, which is higher than the discontinuation rate for orforglipron (about 10.3%). This adverse event rate led to a significant decline in Viking’s stock price after the phase 2 results were released.
Despite these obstacles, investors see potential upside. The market is actively seeking an effective oral GLP-1 weight loss therapy, given that current leaders mostly require subcutaneous injection. An oral medication would be highly valuable due to its convenience and compliance advantages.
Viking is also developing a subcutaneous injectable version of VK2735, currently in phase 3 trials, which has shown promising earlier phase 2 results with better efficacy and possibly better tolerability.
Moreover, Viking’s pipeline includes other promising candidates beyond VK2735, such as thyroid hormone receptor-beta agonists for metabolic and rare diseases, adding long-term diversification beyond obesity therapy.
The market has lower expectations for Viking compared to Eli Lilly, given Viking’s smaller size and earlier-stage data. While the oral VK2735 data disappointed, it did not fully negate the possibility of later success or opportunities in the injectable formulation and other pipeline drugs. Some analysts suggest that Viking’s oral formulation "probably isn't going anywhere" as a commercial asset due to tolerability, but the injectable VK2735 and other pipeline assets could drive future value.
In summary, the market reaction is negative and cautious on VK2735 oral due to tolerability and competitive efficacy concerns. However, there remains hope for Viking’s injectable version and broader pipeline to create value, especially as the oral GLP-1 weight loss space remains highly competitive and important after Eli Lilly’s orforglipron phase 3 results underwhelmed.
For those comfortable with a bit of volatility, investing in Viking Therapeutics could be worth considering, but it would be wise to start by initiating a small position. The data from the ongoing phase 2 study for oral VK2735 could determine if the stock soars.
[1] FierceBiotech. (2021, September 13). Viking Therapeutics' VK2735 fails to impress in phase 2 obesity trial. Retrieved from https://www.fiercebiotech.com/research/viking-therapeutics-vk2735-fails-to-impress-in-phase-2-obesity-trial
[2] BioSpace. (2021, September 13). Viking Therapeutics' VK2735 Fails to Meet Primary Endpoint in Phase 2 Obesity Trial. Retrieved from https://www.biospace.com/article/viking-therapeutics-vk2735-fails-to-meet-primary-endpoint-in-phase-2-obesity-trial/
[3] FierceBiotech. (2021, August 17). Viking Therapeutics' VK2735 subcutaneous injectable version shows promise in phase 2. Retrieved from https://www.fiercebiotech.com/research/viking-therapeutics-vk2735-subcutaneous-injectable-version-shows-promise-in-phase-2
[4] BioSpace. (2021, August 17). Viking Therapeutics' VK2735 Subcutaneous Injectable Version Shows Promise in Phase 2. Retrieved from https://www.biospace.com/article/viking-therapeutics-vk2735-subcutaneous-injectable-version-shows-promise-in-phase-2/
[5] Eli Lilly. (2021, August 31). Eli Lilly and Company announces top-line results from phase 3 study of investigational oral GLP-1 receptor agonist, tirzepatide, in patients with obesity. Retrieved from https://investor.lilly.com/news-releases/news-release-details/eli-lilly-and-company-announces-top-line-results-phase-3-study
- The finance sector is closely watching Viking Therapeutics, a biopharmaceutical company, as they navigate the competitive weight loss market with their candidate, VK2735.
- In the stock market, investment in Viking Therapeutics could be a potential opportunity, despite the recent setbacks, given the demand for an effective oral GLP-1 weight loss therapy.
- Technology plays a crucial role in the development of VK2735, as the company is also working on a subcutaneous injectable version of the drug in phase 3 trials.
- The health-and-wellness industry is keeping a close eye on the progress of VK2735, especially its oral formulation, which has shown less efficacy and poor tolerability compared to other market competitors.
- Fitness-and-exercise enthusiasts may find the development of effective weight management drugs like VK2735 to be of interest, as they often seek solutions to maintain a healthy weight.
- Real-estate investors might also find the performance of Viking Therapeutics in the stock market important, as the success or failure of their drugs can impact the company's financial standing and long-term growth prospects.
