This Small Pharma Firm Has What It Take to Compete with the Big Names

Viking Therapeutics (NASDAQ: VKTX) stock soared by 34% following its July 25 earnings call, which demonstrated the value of the projects in its pipeline. In fact, there’s reason to believe that Vikin may be on track to compete with the biggest names in pharmaceuticals, such as Eli Lilly and Novo Nordisk. Here’s why.

How Does Viking Work?

Viking is extraordinarily good at managing its money. The company has investments plus cash on hand of more than $940 million. It only spent a little less than $24 million on research and development in the last quarter, yet it produced some stunning results in its clinical trial data.

Viking’s most heavily hyped project is a weight loss drug that would rival Novo Nordisk’s Wegovy and Eli Lilly’s Zepbound. Known as VK2735, the medication is moving on to Phase 3 trials. So far, it appears to produce faster results than either of the existing blockbuster drugs. The company is also working on a once-a-month formulation, as well as an oral version of the medication.

But VK2735 isn’t the only product Viking is working on. It’s also completed a highly successful Phase 2b trial of a treatment for metabolic dysfunction-associated steatohepatitis (MASH). It’s expected to move into Phase 3 later this year.

In addition, Viking is already in preclinical studies for a next-generation weight loss drug. If very early animal trials are replicable in humans, it would represent a quantum shift in the way weight loss in managed. Preclinical studies showed that animals shed a stunning 8% of their body mass in just 72 hours after treatment with the medication.

How Close Are They?

Viking clearly has some potential winners in its pipeline, and the company has proven highly adept at managing a relatively lean research and development budget. But is Viking really anywhere close to actually competing with Eli Lilly or Novo Nordisk? Many analysts believe so. The global weight loss industry is expected to top $400 billion by 2030, and there are already shortages of both Zepbound and Wegovy. A third drug seems essential to meet ever-growing demand. If VK2735’s clinical trial results are replicated in the general population, it may even turn out to be a better medication.

Meanwhile, Viking’s robust cash on hand and diverse line of products could help the company weather any potential downturns. Nothing is ever guaranteed, especially in biotech, but Viking isn’t hanging its entire fortune on a single drug. Should one thing happen to not pan out, it’s in good shape to pivot rapidly.

Neither Lisa Fritscher nor Stocks.News have positions in this company.