Viking Therapeutics stock rocketed Thursday after the company said it's exploring a monthly dose of its weight-loss drug. The news is a blow to obesity kingpins Novo Nordisk and Eli Lilly.
The small biotech company also said it will accelerate its under-the-skin shot, dubbed VK2735, directly into final-phase testing following a meeting with the Food and Drug Administration. This indicates an accelerated pathway, Leerink Partners analyst Thomas Smith said in a client note. Previously, Viking planned for a Phase 2b study.
The news rocked shares of Eli Lilly and Novo Nordisk. The duo lead the weight-loss drugs market with Zepbound and Wegovy, respectively. But their weekly shots are facing shortages, meaning competitors have wiggle room to jump into the market.
And Viking is the first to announce a potential monthly injection.
"While we find VK2735 to be a potential best-in-class injectable compound, a once-monthly formulation may be a significant competitive differentiator for Viking," Maxim Group analyst Naz Rahman said in a report. "Patients are known to be (noncompliant) on weekly therapies, thus reducing the administration burden to once-monthly may be a highly attractive proposition."
On the stock market, Viking Therapeutics stock shot 28.3% to 64.68. Eli Lilly stock lost 4.5%, closing at 821.51. Novo Nordisk stock fell 2.9% to 127.83.
Viking Therapeutics Stock Makes A Bullish Move
Viking Therapeutics' news is particularly troubling for Eli Lilly stock. Zepbound mimics two hormones, GLP-1 and GIP, to improve feelings of satiety and markers of blood sugar. But Zepbound is an injection. Viking is testing its drug — which uses the same mechanism — as both a shot and a pill.
The company also announced plans to begin a 13-week study of its weight-loss drug beginning in the fourth quarter. This follows "competitive weight loss and a clean safety profile at week four," Leerink's Smith said.
He has an outperform rating on Viking Therapeutics stock.
"Overall, we expect strength in Viking Therapeutics shares on the back of (Wednesday's) updates, with a potentially expedited path for (under-the-skin) VK2735 and ongoing dose escalation for oral VK2735 that continues to suggest differentiated safety/tolerability and best-in-class potential," he said.
The market for oral weight-loss drugs is also heating up. Pfizer recently announced plans to move its daily pill, danuglipron, into further testing. Roche said earlier this month patients who took its weight-loss pill, CT-996, lost 6.1% more body weight over a month that placebo recipients.
Viking Therapeutics stock bounded off its 50-day moving average, MarketSurge shows. Viking stock has a perfect IBD Digital Relative Strength Rating of 99, putting it in the leading 1% of all stocks when it comes to 12-month performance.
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