Viking Therapeutics $VKTX shares tumble 42% after oral weight-loss pill posts 12.2% loss over 13 weeks, missing 15% target

Viking Therapeutics has faced a sharp setback in the competitive obesity treatment landscape, with shares tumbling dramatically after mid-stage trial results for its experimental oral weight-loss pill fell short of investor expectations. The data, released on 19 August 2025, revealed an average weight reduction of 12.2% over 13 weeks, a figure that analysts had hoped would reach closer to 15% to challenge market leaders. This disappointment underscores the high stakes in developing convenient pill-based alternatives to injectable therapies, where tolerability and efficacy remain critical hurdles.

The Trial Data and Market Reaction

The mid-stage study for Viking’s VK2735, an oral formulation targeting obesity, demonstrated statistically significant weight loss compared to placebo, with patients achieving up to 12.2% reduction in body weight at the highest dose. However, the results were marred by elevated rates of gastrointestinal side effects, including nausea in 58% of participants and vomiting in 25%, leading to discontinuation rates as high as 38% in the top-dose group. These figures, while not uncommon in the GLP-1 agonist class, failed to impress in a field dominated by Eli Lilly and Novo Nordisk, whose products have set benchmarks for both efficacy and patient retention.

Shares of Viking Therapeutics closed at $24.36 on 19 August 2025, marking a decline of 42.12% from the previous close of $42.09. Trading volume surged to 63,954,532 shares, far exceeding the 10-day average of 5,152,740, reflecting intense investor scrutiny. The stock’s day range spanned $23.22 to $26.25, highlighting the volatility triggered by the announcement. This drop positions the shares near the lower end of their 52-week range of $18.92 to $81.73, erasing gains that had built on earlier optimism around Viking’s pipeline.

Analyst sentiment, as reported by credible sources like Reuters and CNBC, has turned cautious. Wall Street had anticipated weight loss outcomes in the 10% to 15% range, with the upper end seen as necessary to position VK2735 as a viable contender. The shortfall has reinforced perceptions that oral therapies may struggle to match the potency of injectables without compromising on side effects, a dynamic that could delay Viking’s path to market dominance.

Context in the Obesity Drug Boom

The obesity treatment market has exploded in recent years, projected by analysts to exceed $100 billion annually by 2030, driven by demand for GLP-1 receptor agonists like semaglutide and tirzepatide. Novo Nordisk’s Wegovy and Eli Lilly’s Zepbound have captured significant share with weight loss averages of 15% or more in longer-term studies, albeit with their own tolerability challenges. Viking’s earlier Phase 1 data for VK2735, published in March 2024, showed promise with up to 3.3% weight loss in a small cohort, fueling speculation of a “best-in-class” oral option. A subsequent mid-stage injectable trial in February 2024 reported nearly 15% weight loss, doubling the company’s share price at the time.

Yet, the latest oral trial’s 12.2% figure over just 13 weeks, while competitive on a per-week basis, did not alleviate concerns about scalability and long-term adherence. High dropout rates echo issues seen in competitors’ data; for instance, Lilly’s orforglipron Phase 2 results from 2023 showed 14.7% weight loss but with 20–30% discontinuations due to adverse events. Viking’s results, therefore, highlight a persistent trade-off in the sector: balancing efficacy with patient comfort in non-injectable formats.

Implications for Viking and the Broader Sector

This stumble could reshape Viking’s strategic outlook. With a market capitalisation now at $2.74 billion and shares trading at a forward price-to-earnings ratio of -16.13 based on expected losses of $1.51 per share, the company faces pressure to refine its dosing or combination strategies. Analysts from firms like Cantor Fitzgerald, who maintained an overweight rating with a $104 price target as of recent reports, may revise forecasts downward if Phase 3 timelines slip. Viking’s book value stands at $7.08 per share, providing some financial cushion, but the 50-day moving average of $31.41 and 200-day average of $34.99 indicate a downward trend that predates this event, with a 22.44% drop over the past 50 days.

Beyond Viking, the data reinforces the duopoly of Lilly and Novo, whose shares rose modestly on the news—Lilly up 1.7% and Novo up 1% in sentiment echoed across financial platforms. This reaction suggests investors view the results as diminishing a potential threat, allowing incumbents to solidify their positions. However, it also spotlights opportunities for other biotechs; companies like Structure Therapeutics or Altimmune, pursuing similar oral candidates, may learn from Viking’s tolerability pitfalls to adjust their protocols.

From a macroeconomic perspective, the obesity epidemic affects over 1 billion people globally, per World Health Organization estimates from 2022, driving relentless innovation. Yet, regulatory hurdles remain stringent. The U.S. Food and Drug Administration has approved oral weight-loss drugs in the past, but none have matched the GLP-1 class’s impact without significant side effects. Viking’s next steps, including potential partnerships or acquisitions, will be crucial. Rumours of interest from larger pharma players have circulated since 2024, and this dip might accelerate such discussions, though at a lower valuation.

Investor Considerations and Forward Outlook

For investors, the key takeaway is the volatility inherent in biotech stocks tied to clinical milestones. Viking’s earnings per share for the trailing twelve months stand at -$1.54, with current-year estimates at -$2.38, underscoring its pre-revenue status. The consensus rating of 1.6 (Buy) as of 19 August 2025 suggests some optimism persists, likely hinged on the company’s broader pipeline, including an injectable version of VK2735 that showed stronger results earlier.

• Efficacy Benchmarks: Aim for sustained weight loss above 15% with low discontinuations to compete.
• Tolerability Improvements: Dose titration or adjunct therapies could mitigate GI issues, as seen in Novo’s evolving regimens.
• Market Expansion: Success in orals could tap underserved segments wary of injections, potentially adding billions in revenue.

Model-based forecasts from analysts indicate that if Viking advances to Phase 3 with refined data, peak sales for VK2735 could reach $2–3 billion annually by 2030, assuming 10–15% market share in the oral segment. However, failure to address side effects might cap this at under $1 billion. Sentiment from verified sources like Bloomberg and Investing.com labels the reaction as “disappointing” but not fatal, with some viewing the sell-off as an overreaction given the drug’s statistical significance over placebo.

Strategic Pathways Ahead

Viking’s management has emphasised the trial’s achievement of primary and secondary endpoints, positioning VK2735 as a viable option despite the shortfall. Upcoming earnings on 23 July 2025—wait, correction: the next reported date is in the past, but forward guidance will be key in subsequent quarters. Investors should monitor for updates on trial expansions or new data readouts, which could restore confidence.

In a sector where dry humour might note that weight-loss drugs often leave investors lighter in the wallet before paying off, Viking’s case serves as a reminder of the thin line between breakthrough and breakdown. The path forward demands not just scientific prowess but strategic agility to navigate a market hungry for innovation yet unforgiving of mediocrity.

References

• BioPharma Dive. (2024). Viking obesity drug oral Phase 1 study results. https://www.biopharmadive.com/news/viking-obesity-drug-oral-phase-1-study-results/711383/
• Bloomberg. (2025). Viking Therapeutics slumps as weight-loss pill study underwhelms. https://www.bloomberg.com/news/articles/2025-08-19/viking-therapeutics-slumps-as-weight-loss-pill-study-underwhelms
• CNBC. (2025). Viking Therapeutics obesity pill data. https://www.cnbc.com/2025/08/19/viking-therapeutics-obesity-pill-data.html
• Endpoints News. (2025). Viking’s mid-stage obesity pill disappoints, stock tanks. https://endpoints.news/vikings-mid-stage-obesity-pill-disappoints-stock-tanks/
• Forbes. (2025). Viking Therapeutics shares nosedive toward worst day ever after obesity trial data. https://www.forbes.com/sites/tylerroush/2025/08/19/viking-therapeutics-shares-nosedive-toward-worst-day-ever-after-obesity-trial-data/
• Investing.com. (2025). Viking’s oral obesity drug shows promising weight-loss results. https://www.investing.com/news/company-news/vikings-oral-obesity-drug-shows-promising-weight-loss-results-93CH-4199763
• Morningstar. (2025). Viking Therapeutics announces positive top-line results. https://www.morningstar.com/news/pr-newswire/20250819la54249/viking-therapeutics-announces-positive-top-line-results-from-phase-2-venture-oral-dosing-trial-of-vk2735-tablet-formulation-in-patients-with-obesity
• Reuters. (2025). Viking’s weight-loss pill data disappoints, shares sink. https://www.reuters.com/business/healthcare-pharmaceuticals/vikings-weight-loss-pill-data-disappoints-shares-sink-2025-08-19/
• TradingView News. (2025). Viking Therapeutics oral weight-loss pill meets expectations. https://www.tradingview.com/news/reuters.com,2025:newsml_L4N3UB0OV:0-viking-therapeutics-oral-weight-loss-pill-meets-expectations-in-mid-stage-study/
• X. Multiple accounts: @BioPharmaDive, @Pharmdca, @EarningsTime, @BenFidler, @InvestorBuzz, @iNews24