Viking Therapeutics Just Rocketed Back—Here’s The Explosive Reason Why

Viking Therapeutics just pulled off a stunning market reversal—and the biotech world is scrambling to catch up.

Clinical Triumph Ignites Rally

Fresh trial data smashed expectations, sending shockwaves through trading floors. The numbers don’t lie—this wasn’t a fluke. Investors piled back in, reversing last week’s bearish sentiment in minutes.

Short Sellers Get Torched

Anyone betting against this bounce got burned. Hard. The velocity of the rebound left hedge funds staring at red screens and margin calls. Classic case of under-estimating a data-driven catalyst.

Big Pharma Eyes A Prize

Rumors of acquisition interest are swirling—again. When a therapy shows promise, the sharks start circling. Viking’s pipeline suddenly looks like a bargain, even after today’s pop.

Market Realities Bite Back

Let’s be real—biotech rebounds are fickle. One positive data read doesn’t erase volatility. But for now? Viking’s trading like it’s 2021 and someone just found the printer for risk-on sentiment. Just don’t expect Wall Street to learn its lesson—next week, they’ll probably overhype another preclinical doodle.

Viking Therapeutics VK2735 phase 2 results

The phase 2 results were successful in weight loss reduction, but less so in safety and tolerability. In comparison, a phase 3 trial for pharma giant(LLY -0.69%) orforglipron in weight loss resulted in a mean percentage weight loss of 7.8% at the lowest dosage to 12.4% at the highest dosage. Meanwhile, the VK2735 phase 2 ranged from a mean reduction of 2.3% to 12.2% at the highest dosage.

The key difference is that the discontinuation rate due to adverse effects in Eli Lilly's phase 3 trial was 10.3% at the highest dosage, compared to 20% overall in the Viking phase 2 trial.

What it means to investors

A few analysts are saying the sell-off is overdone, and with good reason. Recall that Viking's trial, although disappointing, is only a phase 2 with 280 enrolled patients, compared to Eli Lilly's phase 3 with 4,500.

Image source: Getty Images.

It's also at odds with the earlier phase 1 trial, which indicated good safety and tolerability.

As such, a larger company may step in to try to improve tolerability and take VK2735 (oral form) through phase 3 by buying Viking or partnering with it. However, it could be a while before there's any upside catalyst to the stock price coming from trial data, as the phase 3 trial for oral VK2735 only started in June. It's a disappointing update, but there's still upside potential for the stock from here.