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Viking Therapeutics, Inc. (VKTX)·Q1 2024 Earnings Summary

Executive Summary

  • Q1 2024 delivered strong clinical catalysts: subcutaneous VK2735 achieved up to 14.7% mean weight loss from baseline and up to 13.1% placebo-adjusted at 13 weeks, with favorable tolerability; oral VK2735 showed up to 5.3% mean weight loss from baseline and up to 3.3% placebo-adjusted at 28 days, all AEs mild/moderate and no SAEs .
  • Financially, net loss widened to $27.4M ($0.26 EPS) on higher R&D and G&A, partially offset by greater interest income; cash and investments surged to $963M following a $632.5M offering, materially extending runway .
  • Near-term catalysts: 52-week histology from Phase 2b VOYAGE (VK2809) expected later in Q2 2024; Type C FDA meeting for VK2735 and potential initiation of Phase 2b in 4Q 2024; continued oral VK2735 dose escalation data mid-year .
  • No quantitative financial guidance provided; stock narrative driven by obesity program efficacy, VOYAGE histology potential, and strengthened balance sheet to fund accelerated development .

What Went Well and What Went Wrong

What Went Well

  • Subcutaneous VK2735 hit primary and all secondary endpoints, with statistically significant weight loss vs placebo across doses and progression without plateau through 13 weeks; management: “We believe this suggests that further weight loss could be achieved through extended dosing beyond the 13‑week treatment period” .
  • Oral VK2735 delivered dose-dependent weight loss (up to 5.3% baseline; 3.3% placebo-adjusted) with excellent GI tolerability (all AEs mild/moderate; no SAEs), supporting advancement to Phase 2 obesity trial later this year .
  • Balance sheet strengthened: $963M quarter-end cash/investments after $632.5M gross equity offering, enabling aggressive pipeline development; CFO reiterated runway extension .

What Went Wrong

  • Operating expenses increased: R&D rose to $24.1M and G&A to $10.0M, widening net loss to $27.4M ($0.26 EPS), driven by manufacturing, preclinical/clinical, and compensation costs .
  • Broader industry supply constraints (solvents, solid-phase synthesis, fill/finish) pose manufacturing ramp risks for incretin class; management sees non-permanent but acknowledges thorough current shortfalls .
  • No quantitative guidance and uncertainty around VOYAGE fibrosis powering (designed around NASH resolution; not powered for fibrosis), tempering near-term clarity on regulatory endpoints; management expects low-double-digit NASH resolution delta and is planning end-of-Phase 2 FDA discussion post-readout .

Financial Results

MetricQ1 2023Q3 2023Q4 2023Q1 2024
Revenue ($USD Millions)$0.0 $0.0 N/A (not disclosed quarterly) $0.0
Diluted EPS ($USD)$(0.25) $(0.23) $(0.25) $(0.26)
R&D Expense ($USD Millions)$11.0 $18.4 $20.5 $24.1
G&A Expense ($USD Millions)$9.5 $8.9 $8.8 $10.0
Total Operating Expenses ($USD Millions)$20.5 $27.3 N/A $34.1
Net Loss ($USD Millions)$19.5 $22.5 $24.6 $27.4
Cash, Cash Equivalents & Short-term Investments ($USD Millions)N/A$376 $362 $963

Notes:

  • Margins (gross, net) not meaningful due to zero revenue, as reflected in filings .

KPIs and Clinical Efficacy

KPIQ3 2023Q4 2023Q1 2024Trend
VK2735 SC weight loss vs baseline (%)Up to 7.8% after 28 days Expectation set; Phase 2 results pending Up to 14.7% at 13 weeks Accelerating efficacy with longer dosing
VK2735 SC placebo-adjusted weight loss (%)Up to 6.0% after 28 days Expectation set Up to 13.1% at 13 weeks Strengthened vs placebo
VK2735 oral weight loss vs baseline (%)——Up to 5.3% at 28 days Positive initial oral signal
VK2735 oral placebo-adjusted (%)——Up to 3.3% at 28 days Positive initial oral signal
VOYAGE (VK2809) MRI-PDFF median reduction (%)38–55% at Week 12 Reinforced at AASLD Histology readout expected Q2 Efficacy consistent; histology pending

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Financial (Revenue, EPS, OpEx)FY/Q2 2024Not provided Not provided Maintained (no guidance)
Clinical Milestones1H–Q2 2024VOYAGE histology expected 1H 2024 VOYAGE histology later this quarter (Q2) Narrowed timing (sooner)
VK2735 SC next steps2024Expect top-line; planning Type C FDA meeting this quarter; Phase 2b likely start in 4Q 2024 Advanced clarity on path
VK2735 Oral next steps2024Phase 1 ongoing Further dose escalation; Phase 2 obesity trial initiation later this year Advanced clarity on path

Earnings Call Themes & Trends

TopicPrevious Mentions (Q3 2023, Q4 2023)Current Period (Q1 2024)Trend
VK2735 SC efficacy/tolerabilityPhase 2 VENTURE fully enrolled; Phase 1 showed up to 7.8% weight loss, GI AEs mostly mild/moderate Achieved primary/secondary endpoints; up to 14.7% baseline and 13.1% placebo-adjusted weight loss; safe/tolerated Strengthening efficacy profile
VK2735 Oral formulationInitiation; data expected 1Q24 Up to 5.3% baseline, 3.3% placebo-adjusted; AEs mild/moderate; no SAEs; Phase 2 planned Positive signal; advancing
FDA engagement/regulatoryPlanning Phase 2 VENTURE; VOYAGE histology 1H24; end-of-Phase 2 planned post-data Type C meeting this quarter for VK2735; end-of-Phase 2 for VK2809 later this year Increased regulatory clarity
Manufacturing/supply chainPrepared for clinical supply; Catalent deal impact minimal near-term Industry-wide shortages acknowledged (solvents, fill/finish); not viewed as permanent Monitoring risks; not gating
Delivery device (auto-injector)Future studies to use device; timing TBD Plan to use pen device; may start with vial/syringe if device not ready; no bridging study contemplated Progressing to pen device
VOYAGE histology expectationsMRI-PDFF 38–55%; robust lipid lowering; excellent GI tolerability Aims for low-to-mid-teens NASH resolution delta; fibrosis not powered; single-reader with consensus process Readout imminent; expectations set
Business developmentActive environment; open to partnering More data helpful but not gating for conversations Ongoing dialogues

Management Commentary

  • “The first quarter of 2024 was an exceptional period for Viking… positive topline results from the Phase 2 VENTURE study… and encouraging initial data from… oral tablet formulation… We plan to meet with regulators to discuss the path forward… and expect to advance each program into further development later this year.” — Brian Lian, CEO .
  • “We plan to report data from the Phase IIb VOYAGE study… later this quarter… The initial data… affirmed VK2809’s potent efficacy of reducing liver fat… with favorable tolerability and safety profile.” — Brian Lian .
  • “Turning to the balance sheet… cash, cash equivalents and short-term investments of $963 million… reflects receipt of gross proceeds of $630 million from the company’s public offering… closed on March 4, 2024.” — Greg Zante, CFO .

Q&A Highlights

  • Oral VK2735 dose escalation: Continuing until exposure/weight change plateau or tolerability limits; additional cohort data mid-year before deciding upper bounds .
  • Less frequent SC dosing potential: Awaiting PK data (4–6 weeks post-last dose) to assess therapeutic range for reduced frequency; Phase 2b likely to start in 4Q 2024 post Type C meeting .
  • Comparative efficacy vs tirzepatide: Management believes exposures at given doses are significantly higher with VK2735 SC; needs longer studies to judge superiority/comparability .
  • Manufacturing constraints: Current broad shortages across supply chain acknowledged; viewed as non-permanent with capacity ramp expected across industry .
  • Device transition: Plan to use pen/autoinjector; will not allow device readiness to gate study starts; no bridging study anticipated .
  • VOYAGE histology endpoints: Targeting low-to-mid-teens delta for NASH resolution; fibrosis improvement less likely to be statistically significant due to sample size; single-reader with second-reader consensus process .

Estimates Context

  • S&P Global consensus (EPS and revenue) for Q1 2024 and Q4 2023 was unavailable due to request limits; we cannot determine beat/miss vs Street for this quarter. Values from S&P Global were not retrievable; therefore, no estimate comparison is presented (S&P Global consensus unavailable).
  • Note: Viking reported no revenue and negative EPS in Q1 2024, driven by higher R&D and G&A; any future estimate revisions are likely tied to updated OpEx trajectory and timing of clinical milestones rather than top-line metrics .

Key Takeaways for Investors

  • VK2735’s clinical profile strengthened meaningfully (up to 13.1% placebo-adjusted weight loss at 13 weeks), positioning Viking among next-wave obesity entrants; extended dosing could further boost efficacy, a potential valuation driver .
  • Oral VK2735 viability de-risks multi-formulation strategy; early efficacy and clean tolerability improve optionality for maintenance or step-down therapy, expanding commercial scope .
  • VOYAGE histology readout is a material near-term catalyst; achieving low‑to‑mid‑teens NASH resolution delta could validate VK2809’s path to Phase 3 and partnership discussions .
  • Balance sheet at $963M enables acceleration across programs without near-term financing risk, improving execution confidence into regulatory interactions and trial initiations .
  • Manufacturing constraints are an industry-wide issue but not expected to be permanent; device transition to pen form should improve patient experience without gating timelines .
  • Absence of financial guidance keeps focus on clinical milestones; trading set-ups likely around VOYAGE histology and FDA Type C outcomes for VK2735 (dosing duration, design) .
  • Partnering optionality remains open; additional data may enhance terms but is not gating for dialogues, offering potential strategic catalysts .