Viking Therapeutics jumps as obesity updates outshine Q3 beat
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Viking Therapeutics (NASDAQ:VKTX) added ~18% on Thursday to reach a five-month high as Wall Street focused on updates on its obesity candidate VK2735, even as the company posted better-than-expected Q3 financials.
While Viking (NASDAQ:VKTX) improved its liquidity position during the quarter, indicating $930M in cash, cash equivalents, and short-term investments as of Sep. 30, up from $362M at the end of 2023, its upcoming data readouts for VK2735 that caught analysts’ attention.
The company stated that, pending FDA feedback from a meeting this year, VK2735, a dual GLP-1/GIP receptor agonist similar to Eli Lilly’s (LLY) blockbuster weight loss drug Zepbound, is still on track to reach late-stage development.
VKTX generated positive results from a mid-stage trial called VENTURE for injectable VK2735 early this year. The 13-week data from that trial have been selected for a presentation at the Annual Meeting of the Obesity Society, also known as ObesityWeek, in early November.
Viking (NASDAQ:VKTX) expects to share additional Phase 1 data for an oral version of VK2735 from healthy adults at the same event, scheduled for Nov. 3–6, 2024.
“As the next step, we plan to initiate a 13-week Phase 2 study in obesity later this year,” CEO Brian Lian remarked, adding, “We’ll provide details regarding study design as we get closer to trial initiation.”
Wall Street is upbeat about VK2735’s potential to challenge Novo Nordisk (NVO) and Eli Lilly (LLY), the established players in the weight loss drug market.
In September, J.P. Morgan launched its coverage on Viking (VKTX) with a buy-equivalent overweight recommendation, keeping the stock under positive catalyst watch due to the upcoming readout.
According to Bloomberg News, Thomas Smith, an analyst at Leerink Partners, also commented on the readout. “We expect greater dose-dependent weight reductions with continued clean safety/tolerability,” said Smith, who has an Outperform recommendation on VKTX.
Meanwhile, Oppenheimer analyst Jay Olson wrote with a similar rating: “We expect VKTX to focus on getting oral Ph2 and subQ Ph3 studies running following an End-of-Phase 2 meeting later this year, and we anticipate additional details on the study designs.”.