Viking's Positive MASH Data Not the Obesity Update Investors Seek

13 June 2024

Viking Therapeutics, a biotech company known for its weight-loss treatments, has recently shared new histological data regarding its experimental treatment for metabolic dysfunction-associated steatohepatitis (MASH), VK2809. This data suggests that VK2809 could be competitive with Madrigal Pharmaceutical’s Rezdiffra (resmetirom), the only currently approved drug for MASH. However, despite the positive data, Viking's shares saw an 11% drop, possibly due to investor disappointment over the lack of a partnership or acquisition deal to push the treatment through pivotal testing stages.

Phase IIb Study Results

The Phase IIb VOYAGE study data indicate that VK2809 shows promising efficacy in treating MASH. Specifically, 75% of patients who received 10mg of VK2809 every other day saw a resolution of MASH without worsening fibrosis, compared to 29.3% in the placebo group. This results in a placebo-adjusted improvement of 45.7%. Additionally, 56.8% of patients in the treatment group experienced at least a one-stage reduction in fibrosis without worsening MASH, versus 34.1% in the placebo group, yielding a placebo-adjusted improvement of 22.7%.

For comparison, Jefferies analysts noted that Rezdiffra, taken at a dose of 100mg daily, showed about a 20% placebo-adjusted improvement in MASH resolution and roughly a 12% placebo-adjusted improvement in fibrosis of one stage or more with no worsening of MASH.

Safety Profile

VK2809 also demonstrated a safety profile comparable to Rezdiffra. In Rezdiffra’s pivotal study, most side effects were mild to moderate, with serious adverse events (AEs) occurring at a rate of approximately 11-13%. Similarly, in Viking’s study, most treatment-related AEs were mild or moderate. Only 6.1% of VK2809 recipients discontinued treatment due to AEs, compared to 9.2% in the placebo group.

Shift in Investor Focus

Despite the favorable results, VK2809 is not Viking Therapeutics' most prominent candidate at the moment. Analysts, including those from Jefferies, have pointed out that VK2809's slow development and limited intellectual property in a competitive MASH market have led investors to pay it "limited attention." Instead, the focus has shifted to Viking's dual GLP-1/GIP receptor agonist VK2735, which is being developed in both subcutaneous and oral formulations for weight loss.

Weight-Loss Portfolio

In February, Viking reported that the injectable version of VK2735 resulted in a placebo-adjusted mean weight loss of up to 13.1% after 13 weeks in a mid-stage study. In March, the oral formulation achieved a placebo-adjusted mean weight loss of up to 3.3% after 28 days. This has made VK2735 a more attractive asset, especially given its best-in-class weight-loss potential and favorable safety profile, as no severe nausea cases were observed in the study.

Future Prospects and Challenges

In a prior note, Jefferies analysts suggested that a MASH approval for VK2809 would require another study, likely necessitating a partnership. The lack of such a deal might explain the recent drop in Viking’s stock value. Despite this, the promising data for VK2809 could still provide a significant opportunity for Viking, should they secure the necessary support to advance to the next phase of development.

In conclusion, while VK2809 presents competitive efficacy and a comparable safety profile to the only approved MASH drug, investor attention and optimism are currently centered on Viking's weight-loss treatments, particularly VK2735. The future of VK2809 will depend on Viking’s ability to navigate the competitive and challenging MASH market and secure the necessary partnerships to bring the treatment to commercialization.

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