Viking Therapeutics Inc., a biotech company based in San Diego, saw a 4% increase in its stock on Wednesday, adding to the impressive 13% gains it had achieved so far in the week. This surge in market value came as a result of some positive news regarding Novo Nordisk’s obesity drugs and their potential to reduce the risk of cardio events.

Viking Therapeutics is currently working on the development of a GLP-1 receptor agonist, available in both injectable and oral forms, with the aim of treating obesity and diabetes. The mechanism of these drugs is similar to that of Novo Nordisk’s Wegovy and Ozempic, as well as Eli Lilly’s Mounjaro, as they mimic the effects of GLP-1. GLP-1, short for glucagon-like peptide, is a gut hormone known for its ability to regulate blood-sugar levels and suppress appetite.

Excitingly, Viking Therapeutics is set to present data from a Phase 1 trial of its VKTX2735 injectable therapy at Obesity Week this October. Additionally, they are expected to release topline data from the oral treatment VK2735 by the end of this year, according to Truist analysts. These experts have expressed their confidence in Viking Therapeutics by giving the company a buy rating and setting a price target of $32, more than double its current price of around $14.

Taking advantage of their positive Phase 1 trial results, Viking Therapeutics announced plans to launch a Phase 2 trial of VK2736 in the third quarter. They are optimistic about the potential of VK2736 as a promising treatment option.

Apart from their work on obesity and diabetes, Viking Therapeutics is also actively engaged in developing a treatment for NASH (nonalcoholic steatohepatitis), a more severe form of nonalcoholic fatty liver disease (NAFLD) where excess fat accumulates in liver cells. NAFLD affects approximately 25% of Americans, with 20% of those cases progressing to NASH. This condition can lead to cirrhosis and liver failure, particularly among obese individuals or those with diabetes.

Considering the significant demand for liver transplants arising from NASH, there is great anticipation for the therapies currently being developed. Viking Therapeutics is positioning itself as a key player in this field, paving the way for a brighter future in the fight against obesity and related health conditions.

Inside the NASH Drug Boom: New Drugs for a ‘Silent’ Liver Disease Near FDA Approval

The biotech stock sector has endured a two-year slump, but Wall Street is optimistic that NASH drugs could help it recover. These drugs offer hope for treating the ‘silent’ liver disease that affects millions of people. However, there are concerns surrounding the potential costs of these therapies and the accessibility of drugs for a condition often linked to obesity.

Positive News for NASH Drugs

Truist recognizes the significant impact of Wegovy, a drug that has shown a 20% reduction in the risk of cardiovascular events among adults with overweight or obesity, compared to a placebo. This development is seen as a positive sign for NASH drugs.

MACEs as Endpoint for Confirmatory Trials

Major adverse cardiovascular events (MACEs) serve as the endpoint in confirmatory trials for NASH drugs. Analysts, led by Joon Lee, emphasize the importance of NASH drugs demonstrating benefits in cardiovascular outcomes trials (CVOTs). To achieve full approval, such trials require MACE to be the primary endpoint. This is logical considering that cardiovascular complications are the primary cause of death for the majority of NASH patients. The highly positive results from the SELECT trial suggest that Wegovy is likely to receive full approval in the context of NASH.

Analyst Recommendations and Stock Performance

Roth MKM analyst Dylan Dupuis reiterated a “buy” rating on Viking, setting a price target of $32. Viking’s stock has gained an impressive 58% year-to-date. In comparison, the SPDR S&P Biotech exchange-traded fund XBI has fallen 4%, while the S&P 500 SPX has gained 17%.

For more information, read about Novo Nordisk’s Wegovy’s positive results in reducing the risk of cardiovascular events, not just weight loss.

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