Bolstered by progress in the research and development of key weight loss drugs, the stock of biotechnology company Viking Therapeutics (VKTX) experienced a rebound in February. According to data from S&P Global Market Intelligence, the company’s share price rose by 16.5% during the month, recovering some of the ground lost in 2026, with its year-to-date decline narrowing to low single digits. Market analysts suggest that this stock price increase was primarily driven by the company’s fourth-quarter financial report and business update.
For a smaller market-cap biotechnology company like Viking Therapeutics, the core driver of its stock price has always been progress within its R&D pipeline. Currently, market attention is highly focused on the company’s lead candidate drug, VK2735. VK2735 is a dual-acting GLP-1/GIP receptor agonist being developed for the treatment of obesity and diabetes, available in both subcutaneous injection and oral formulations.
Although oral weight loss drugs are highly anticipated by the market due to their advantages like convenience and avoiding injections, the Phase II clinical trial data for the oral formulation of VK2735, released last August, once disappointed the market. The data showed that while patients experienced average weight loss of up to 12.2% after 13 weeks of treatment, the discontinuation rate due to adverse events in the treatment group was as high as 20%, primarily involving gastrointestinal issues such as nausea, vomiting, and diarrhea.
Addressing these market concerns, Viking Therapeutics brought positive news in its recent update. Company management explained that the Phase II trial employed an aggressive dose titration schedule over a relatively short period, potentially not allowing patients sufficient time to adapt to the treatment. Notably, the discontinuation rate due to adverse events in the placebo group also reached 13%, suggesting the overall study population itself may have possessed some challenging characteristics.
Based on this, management has not abandoned the development of the oral VK2735 formulation and announced positive progress: First, the company initiated a maintenance and switch study in the fourth quarter, which has completed enrollment of all subjects, with results expected in the third quarter of 2026. Second, following an end-of-Phase II meeting with the U.S. Food and Drug Administration (FDA) and receipt of feedback, the company plans to advance oral VK2735 into Phase III clinical development in the third quarter of 2026. Additionally, progress has been made on two Phase III trials evaluating the efficacy of subcutaneous VK2735, with one having already completed patient enrollment.
For investors, the clinical trial execution of smaller biotech companies can sometimes be less robust than that of larger pharmaceutical companies, thus requiring a more open mind when interpreting trial results. Management’s current confidence in advancing VK2735’s development, coupled with the upcoming initiation of the Phase III oral formulation study and the highly anticipated maintenance study, brings new hope to the market. Investors anticipate that the results of the maintenance study, due later this year, will demonstrate good safety and tolerability for the oral maintenance dose.
If Viking Therapeutics hopes to impress the market with VK2735, its efficacy data must not only be competitive but also demonstrate good tolerability. If Viking Therapeutics can successfully achieve this, its stock price has the potential to climb significantly over the next 18 months, and the company could establish a solid position in this burgeoning market, achieving steady revenue growth over the next five to ten years. However, any Phase III results falling short of excellent standards would deal a blow to the company, leading to a stock price decline and dimming its development prospects. In summary, the stock carries substantial upside potential, but it is also accompanied by considerable risk, requiring investors to make prudent decisions accordingly.
