(Reuters) – Viking Therapeutics Inc’s experimental obesity drug helped reduce weight and was safe in an early-stage study, the company said on Tuesday, sparking a 60% rise in its shares.
Depending on the success of the drug in upcoming studies, Viking may become a major player in a potential $50 billion market for obesity treatment, while pitting it against industry heavyweights such as Eli Lilly and Co, Amgen Inc and Novo Nordisk.
While Novo Nordisk already has its obesity drug, Wegovy, in the market, Eli Lilly is expecting approval for its treatment later this year.
“If approved, (Viking’s) drug could potentially reach similar levels (in sales) as a competitor to Eli Lilly’s tirzepatide”, BTIG analyst Justin Zelin told Reuters.
That could also make Viking a potential acquisition target, Laidlaw & Company analyst Yale Jen said.
Viking’s experimental drug, VK2735, showed up to a 6% reduction in mean weight, compared with the placebo, and was safe and well-tolerated in the study conducted in about 88 patients.
Like its potential rivals, the drug is designed to activate GLP-1, a hormone that triggers the feeling of fullness in the body after eating.
Viking said it was planning to test higher doses of the drug over a longer treatment window in a mid-stage trial, versus a shorter limit in the current, early-stage trial.
The drug is also being tested in an early-stage extension study to evaluate oral doses for 28 days with results expected by the second half of the year, the company said.
Shares of Viking were trading at $14.15, bringing the drugmaker closer to a market capitalization of $1 billion.
(Reporting by Mariam Sunny in Bengaluru; Editing by Rashmi Aich and Anil D’Silva)
