Viking Therapeutics: The Hidden GLP-1 Growth Powerhouse

Key Points

Viking Therapeutics is making significant progress in its weight loss drug development, with candidates currently undergoing phase 2 and phase 3 trials. The results from these trials have been very encouraging, indicating that the company could be a strong contender in the GLP-1 drug market.

While many people associate GLP-1 drugs with major pharmaceutical companies like Eli Lilly and Novo Nordisk, which produce blockbuster products such as Mounjaro, Zepbound, Ozempic, and Wegovy, the market is not exclusive to these giants. Other biotech firms are entering the space, and if their drugs successfully navigate clinical trials and regulatory approvals, they could challenge the current leaders.

Investors looking for growth opportunities may want to consider Viking Therapeutics (NASDAQ: VKTX), a relatively under-the-radar player in the GLP-1 field that has shown promising potential.

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How GLP-1 Drugs Work

GLP-1 drugs have become popular among individuals seeking to lose weight due to their effectiveness and ease of use. These medications are typically administered via weekly injections and have demonstrated remarkable results in helping patients manage their weight. They work by interacting with hormones that regulate blood sugar levels and appetite, leading to reduced food intake and increased feelings of fullness.

The high demand for GLP-1 drugs has led to shortages in some regions, highlighting the growing need for more treatment options. This presents an opportunity for new players in the market, including Viking Therapeutics.

Viking is currently testing its drug candidate, VK2735, in both injectable and oral formulations. The injectable version is in phase 3 trials, while the oral form is in phase 2. Early results have been positive, suggesting that VK2735 could become a major player in the weight loss market.

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One of the unique aspects of Viking’s approach is that both the injectable and oral formulations use the same molecule. This means that patients can easily switch between the two forms, offering flexibility and convenience.

A Stock Known to React

Investors may benefit from Viking’s progress as it continues to report on trial data for VK2735. In the past, when the company released positive phase 2 trial results, the stock surged by 121% in a single trading session. This demonstrates that Viking’s stock can react strongly to positive news, although such dramatic gains may not occur with every piece of good news.

If VK2735 receives regulatory approval, it could lead to substantial revenue growth and profitability for the company. This potential for long-term gains supports the idea that Viking could offer strong returns for investors willing to take on the risks associated with biotech stocks.

Additionally, some analysts and investors believe that Viking could become a takeover target, which could provide another avenue for gains.

Risks and Considerations

Like any biotech company, Viking faces the risk of setbacks during drug development. Clinical trials can be unpredictable, and there is always the possibility of delays or failures. However, for growth-oriented investors who are comfortable with these risks, Viking represents a compelling opportunity in the GLP-1 space.

Before deciding to invest in Viking Therapeutics, it’s important to consider various factors, including the company’s financial health, competitive landscape, and long-term prospects.

Should You Buy Stock in Viking Therapeutics Right Now?

The Motley Fool Stock Advisor analyst team recently identified what they believe are the 10 best stocks for investors to buy now. While Viking Therapeutics was not among them, the list includes companies that have historically delivered impressive returns.

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For example, Netflix was featured on the list in December 2004, and an investment of $1,000 at that time would have grown to $439,362. Similarly, Nvidia was added to the list in April 2005, and a $1,000 investment would have grown to $1,164,984.

Stock Advisor has consistently outperformed the market, with an average return of 918%, compared to 196% for the S&P 500. Investors interested in learning more about the top 10 stocks can access the latest list through Stock Advisor.

Adria Cimino 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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