Viking Therapeutics’ Hot Stock Slips After Latest Obesity Drug Trial Results

Viking Therapeutics (VKTX) shares fell Monday, handing back early gains, as analysts questioned the path ahead for its developmental weight-loss drugs even after news of upbeat results in clinical trials.

The company’s weight loss drug, which is being tested in oral and injectable forms, led to placebo-adjusted average weight loss of up to 6.8% of a patient’s body weight in a recent trial of the oral version, Viking said Monday as part of an industry conference. JPMorgan analysts earlier this identified the conference as a likely catalyst for Viking shares, with production and sale of the treatment likely several clinical trials and years away.

Viking shares, which rose premarket, were recently down about 11% — though they remain up more than 250% this year so far.

Deutsche Bank analysts wrote Monday that they believe it will be “very costly” for Viking to build the capacity to produce both oral and injectable versions of the drug in multiple dosage sizes. That cost and timeline, they wrote, means current weight loss giants Eli Lilly (LLY) and Novo Nordisk (NVO) have “built moats” that will make it more difficult for Viking and others to compete.

Previous trials of Viking’s drugs have substantially lifted its shares multiple times this year — and, at times, sent Eli Lilly and Novo Nordisk stocks lower over concerns that their weight-loss dominance could be challenged.