The Gold Rush for Weight Loss Drugs is Here. These 3 Latecomers Can Be Worth Buying.
Eli Lilly and Novo Nordisk They are, by far, the kings of the weight loss gold rush. Thanks to their medicines, Zepbound and Wegovy, billions in new investments are guaranteed soon.
But those two juggernauts aren’t the only contestants looking to get a piece of the action — they’re just the first. Three contenders who are eager to go, and may be able to claim the crown one day. Let’s take a look at each to see if any of them are right for your portfolio.
1. Amgen
Among others, Amgen (NASDAQ: AMGN) is known for its collection of antibody drugs, many of which are indicated for the treatment of various types of cancer. Now, it’s putting that experience and biologics to use with its own obesity-focused program.
Amgen’s candidate, MariTide, is a notable contender because data from early clinical trials suggest it can cause weight loss faster than entrants from Eli Lilly and Novo Nordisk. While both Zepbound and Wegovy required a full year of treatment to help patients lose about 21% of their body weight, in its phase 1 study patients taking MariTide lost 14.5% of their weight in less than three months.
Currently, MariTide is in phase 2 trials, and management is already setting the stage for a rapid transition to phase 3 trials as soon as possible. Data from the phase 2 study will be available later this year. Expect the stock to get a healthy bump if mid-term results look as good as earlier, and don’t be afraid to invest early to read the data.
Amgen is a large pharmaceutical company with a large pipeline and many ways to grow outside of obesity, so future success in that segment would be icing on the cake.
2. AstraZeneca
AstraZeneca‘s (NASDAQ: AZN) The obesity drug pipeline consists of three programs, all of which are in early stage clinical trials. But investing in the area of weight loss and treating heart disease is one of the company’s priorities, according to its strategic plan with a deadline of 2030. So, it is possible that in the next year or so it will introduce several other programs or acquire them from other biopharmas.
In addition to its medical programs, by the end of May AstraZeneca is willing to pay up to $80 million in milestone payments and royalties to a biotech called SixPeaks Bio in exchange for the right to acquire it if its candidate obesity in pre-clinical trials can be approached. allowed to enter the clinic and human patients.
The advantage of the SixPeaks method is that it can cause less muscle loss than the treatments produced by Eli Lilly and Novo Nordisk. Currently, those benefits have not been proven, and the company has not released much information from its clinical-level programs.
Therefore, the stock is not worth buying based on the company’s heavy drug development activities alone although there are many other reasons, such as its 2030 strategy, that make it be a good price.
3. Viking Therapeutics
Viking Therapeutics (NASDAQ: VKTX) it’s a biotech rather than a pharma company, so it’s much smaller than Amgen and AstraZeneca, and it’s still working to get its first drug approved for sale.
On the front, its lead candidate, VK2735, has just completed its phase 2 clinical trials, and it has the makings of a winner. After only 13 weeks of treatment, trial patients who received VK2735 instead of placebo lost 14.7% of their body weight, while placebo patients lost only 1.6%. That puts its performance on par with Amgen’s candidate, meaning it also has a realistic shot at being proven more effective than Wegovy or Zepbound.
Viking also has another review of VK2735 in pill form and not as an injection. The data so far show that it is about as effective as the implanted version, although a future phase 2 trial is needed to make that comparison with confidence.
Overall, Viking is a much riskier option than the other two businesses I’ve discussed so far. It doesn’t have any revenue to keep it going even though its cash reserves, cash equivalents, and short-term investments of about $963 billion will probably be enough for the near term. Based on its publications so far, it is worth buying, just be aware that if future data contradicts previous findings, it will be a disaster for the stock.
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Alex Carchidi has no position in any of the products mentioned. The Motley Fool recommends Amgen, AstraZeneca Plc, and Novo Nordisk. The Motley Fool has a publicity strategy.
The Gold Rush for Weight Loss Drugs is Here. These 3 Latecomers Can Be Worth Buying. was originally published by The Motley Fool
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