Is There a Future for Viking Therapeutics?
Key Points
Viking has initiated an exciting new phase 1 study combining an oral and subcutaneous formulation of a weight loss drug.
The phase 1 trial results are expected next year, with the Phase 3 (subcutaneous) trial results scheduled for 2027.
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After the release of the top-line results from its phase 2 clinical trial of its lead drug candidate, VK2735 (oral formulation), in August, there were investors who doubted whether Viking Therapeutics (NASDAQ: VKTX) had a bright future. But a closer look suggests there are strong reasons to believe the recovery in the stock price since then is justified. Here's why.
Vikings Therapeutics in 2025
The company's VK2735 is a GLP-1 and GIP agonist weight loss drug being clinically tested in subcutaneous (injection under the skin) and oral formulations. The subcutaneous formulation is currently enrolling participants in phase 3 trials (for individuals with obesity and type 2 diabetes), with results expected in 2027. Its phase 2 results are excellent, and it may offer a viable alternative to rival offerings from Novo Nordisk and Eli Lilly.
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However, the real excitement around VK2735 is arguably centered on the oral formulation, which reported superb efficacy, safety, and tolerability results in a phase 1 trial. Efficacy was also demonstrated in the phase 2 trial. Still, investors were disappointed by the 20% discontinuation rate among participants using oral VK2735, and the stock sold off heavily.
Why Viking Therapeutics' stock came back and could have a bright future
While the phase 2 safety and tolerability data were disappointing, there are a couple of key points to consider. First, the phase 2 trial produced some rather unusual data. For example, the discontinuation rate in the placebo group was 13%, which is notably higher than the rates in the treatment groups of phase 3 trials for similar drugs by Novo Nordisk and Eli Lilly. This suggests the trial may have had a difficult cohort of participants.
Image source: Getty Images.
Second, management has initiated a phase 1 trial to explore the possibility of using VK2735 (oral) as a maintenance dose in combination with VK2735 (subcutaneous), which could lead to commercialization of the oral formulation. Results of these trials are expected in 2026.
As such, there's still plenty to look forward to with Viking Therapeutics.
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Lee Samaha has no position in any of the stocks mentioned. The Motley Fool recommends Novo Nordisk and Viking Therapeutics. The Motley Fool has a disclosure policy.
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