Viking Therapeutics, Inc. (NASDAQ: VKTX) is a clinical-stage biopharmaceutical company focused on the development of novel, therapies for metabolic and endocrine disorders. Viking has exclusive worldwide rights to a portfolio of five therapeutic programs in clinical trials or preclinical studies, which are based on small molecules licensed from Ligand Pharmaceuticals Incorporated.
2018 is off to an excellent start at Viking. With the completion of enrollment in Phase 2 clinical trial evaluating VK2809 for liver disease. The company also continued planning for a potential meeting with regulators regarding the next date for its SARM candidate VK5211 for hip fracture. Moreover, finally, it also advanced both of its earlier stage programs targeting glycogen storage disease and X-linked adrenoleukodystrophy.
On June 5th, the company announced that enrolment had been completed in the company’s ongoing Phase 2 clinical trial of VK2809 in patients with primary hypercholesterolemia and non-alcoholic fatty liver disease (NAFLD). VK2809 is a novel, orally available small molecule thyroid receptor agonist that possesses selectivity for liver tissue, as well as the beta receptor subtype, suggesting promise in this patient population. Viking expects to announce results from this trial in the second half of 2018.
The company has completed this important milestone in a time-bound manner and remain on track to report top-line results during the second half of this year. The management believes that VK2809’s potent activity at the thyroid beta receptor may provide benefit to patients with the fatty liver disease, such as non-alcoholic steatohepatitis (NASH).
In vivo studies have shown that treatment with VK2809 leads to significant improvement in markers related to NASH development, severity, and progression. In addition, prior clinical data in subjects with mild hypercholesterolemia have demonstrated that treatment with VK2809 results in significant reductions in LDL cholesterol, triglycerides and atherogenic proteins.
Before this, on May 9th, VKTX announced its financial results for the first quarter ended March 31, 2018 and provided an update on its clinical pipeline and other corporate developments. The first quarter has been an exciting and productive period for Viking as it built upon the momentum from 2017.
Below is the program-wise update for the company:
- Completes Enrolment in Phase 2 Study of VK2809 in Patients with Hypercholesterolemia and Non-Alcoholic Fatty Liver Disease Top-Line Results Expected in Second Half of 2018
- With its novel selective androgen receptor modulator (SARM) VK5211, for hip fracture, it continued working toward a planned meeting with the FDA on potential next steps for the program. This meeting will occur in the second half of the year.
- The company continued to advance its rare disease programs targeting glycogen storage disease (GSD) and X-linked adrenoleukodystrophy (X-ALD). Viking expects to initiate a proof-of-concept trial for VK2809 in GSD Ia this quarter, and plan to complete IND-enabling studies for VK0214 in X-ALD later this year. Each of these programs represents exciting future opportunities for Viking.
On the liquidity front, In the first quarter of 2018, Viking received a total of approximately $63 million in gross proceeds through the issuance of common stock. These proceeds will be used to support the company’s ongoing development programs, partnering efforts and other corporate activities. As of March 31, 2018, the company had $77.5 million in cash, cash equivalents, and short-term investments. According to the company, it believes that it has enough financial flexibility to sustain operations until Q2 of 2019.
Viking’ scrip continues to be on the rapid growth trajectory, supported by positive clinical results/announcements and successfully financing from institutional investors. The market believes that the company is at a critical inflection point right now and 2018 is expected to be an incredible year for the company.
Considering recent developments, analysts see promise in the company and believe it will provide a robust fundamental appeal to the investors as well as momentum players trading the stock. Several brokerage firms have initiated coverage on the company, and the stock currently has an average rating of “Buy” and a consensus price target of $14.
About the company: Viking Therapeutics, Inc. is a clinical-stage biopharmaceutical company focused on the development of novel, first-in-class or best-in-class therapies for metabolic and endocrine disorders. The company’s research and development activities leverage its expertise in metabolism to develop innovative therapeutics designed to improve patients’ lives. Viking has exclusive worldwide rights to a portfolio of five therapeutic programs in clinical trials or preclinical studies, which are based on small molecules licensed from Ligand Pharmaceuticals Incorporated.
Clinical Programs:
The company’s clinical programs include: VK5211, an orally available, non-steroidal selective androgen receptor modulator (SARM) in Phase 2 development for the treatment and prevention of lean body mass loss in patients who have undergone hip fracture surgery; and VK2809, a small molecule thyroid beta agonist in Phase 2 development for the treatment of hypercholesterolemia and non-alcoholic fatty liver disease (NAFLD). Viking is also developing novel and selective agonists of the thyroid beta receptor for glycogen storage disease type 1a (GSD 1a) and X-linked adrenoleukodystrophy (X-ALD), as well as programs targeting diabetes, metabolic diseases and anemia.
First Quarter 2018 Results:
- For the three months ended March 31, 2018, Viking reported a net loss of $3.6 million, and a basic net loss per share of $0.08, compared to a net loss of $5.2 million, and a basic net loss per share of $0.23, in the corresponding period in 2017. The decrease in net loss for the three months ended March 31, 2018, was primarily due to the increase in income related to the decrease in fair value of debt conversion feature liability.
- Research and development expenses for the three months ended March 31, 2018, were $3.0 million compared to $3.5 million for the same period in 2017. The decrease was primarily due to decreased manufacturing expenses for drug candidates and a decrease in activities related to the VK5211 clinical development program, offset by an increase in certain pre-clinical efforts and an increase in the use of third-party consultants.
- At March 31, 2018, Viking held cash, cash equivalents and short-term investments totaling $77.5 million. As of April 30, 2018, Viking had 50,933,195 shares of common stock outstanding.
Key risk factors and potential stock drivers:
If one or more of their current drug candidates receive regulatory approval or gets commercialized, it would be a significant catalyst;
VKTX is a clinical-stage company and expects to incur substantial operating losses during the next stages of corporate development.
The company is dependent on technologies licensed from Ligand, and if they lose the license, their ability to develop existing and new drug candidates would be harmed.
The biotech space is a high-risk sector due to uncertainties associated with the novel drug development. Any adversities related with the same could upset the stock performance significantly.
Stock Chart:
Comments:
- On Tuesday, June 5th, 2018, VKTX was at $10.08, on volume of 1.3 million shares exchanging hands. Market capitalization is $475.207 million. The current RSI is steady at 79.18
- In the past 52 weeks, shares of VKTX have traded as low as $0.88 and as high as $11.17
- At $10.08, shares of VKTX are trading significantly above its 50-day moving average (MA) at $5.00 and above its 200-day moving average (MA) at $3.95
- The present support and resistance levels for the stock are at $8.39 & $10.09 respectively.
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