JPMorgan has shown confidence in Viking Therapeutics by initiating coverage of the biopharmaceutical company with an overweight rating and setting a price target of $80 per share. This represents a significant upside of more than 46% from the current trading price. The firm believes that Viking’s obesity drug VK-2735 has the potential to make a mark in the market alongside established GLP-1 drugs from Novo Nordisk and Eli Lilly.

Viking Therapeutics is actively advancing its obesity drug through clinical trials. The company has announced plans for a phase 3 trial of an injectable version of VK-2735, while also preparing for a phase 2 study of an oral version. The upcoming data release in early November regarding the oral version is anticipated to be a crucial catalyst for the stock’s performance.

Analyst Hardik Parikh at JPMorgan expects Viking’s drug to offer better tolerability for patients compared to existing GLP-1 drugs like Novo’s Wegovy and Eli Lilly’s Zepbound. These drugs, which mimic gut-derived hormones to regulate blood sugar levels and induce a sense of fullness, are currently administered through injections. However, many patients prefer oral medication due to its convenience and cost-effectiveness.

Despite facing challenges such as manufacturing requirements and intense competition in the obesity drug market, Viking Therapeutics seems poised for growth. JPMorgan forecasts that the GLP-1 drug category could achieve annual sales of $120 billion by 2030, with oral medications accounting for a significant portion of the market by 2035. This aligns with the company’s strategy of developing both injectable and oral versions of its drug.

Viking Therapeutics has emerged as a promising player in the GLP-1 boom, offering a unique value proposition in the obesity drug market. With ongoing clinical trials, favorable market dynamics, and the potential for superior patient outcomes, the company’s stock is poised for significant upside in the coming years. Investors are closely monitoring the developments at Viking Therapeutics, anticipating positive results that could validate the firm’s optimistic outlook.

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