Viking Therapeutics trades below targets as VK2735 oral safety questioned

Viking Therapeutics' shares trade at a meaningful discount to Wall Street's price targets, reflecting skepticism that the biotech's dual-formulation obesity drug VK2735 can clear safety hurdles and carve out share in a market where Eli Lilly and Novo Nordisk already dominate. The company is betting that pairing an injectable with an oral version of the same GLP-1/GIP receptor agonist will differentiate it, but analysts and investors remain split on whether the oral formulation's safety profile can withstand regulatory scrutiny.

"VK2735's dual approach is strategically sound, but the oral formulation carries clinical risk that the injectable doesn't," said Sam Goldstein, a biotech analyst tracking the obesity space. "The market is pricing in that uncertainty, which is why the stock trades where it does relative to analyst targets."

The competitive backdrop is unforgiving. Eli Lilly's Mounjaro generated $9.94 billion in second-quarter revenue, up 91 percent year over year, with U.S. growth of 45 percent and international growth of 172 percent after China added the drug to its national reimbursement list. Novo Nordisk's Wegovy and Ozempic franchise continues to anchor the semaglutide market. Employer coverage of GLP-1 weight-loss drugs has also tightened, falling from 72 percent in 2025 to 60 percent in 2026, with roughly 14 percent of surveyed employers having already dropped the medicines or planning to do so by 2027.

The Oral Formulation Question

VK2735 is a dual agonist targeting both GLP-1 and GIP receptors, the same mechanism class as Lilly's tirzepatide. Viking's differentiation thesis rests on offering both subcutaneous and oral delivery of the same molecule, potentially giving patients a step-down option from injection to pill. But the oral formulation has raised safety questions that the injectable version does not face, including gastrointestinal tolerability and bioavailability concerns that have historically plagued oral peptide drugs.

The broader GLP-1 safety picture has also drawn regulatory attention. Brazilian health authorities have recorded 83 deaths under investigation and more than 3,600 complications linked to weight-loss drugs since 2018, with over 60 percent of those complications reported in 2025 and 2026. While many of those cases involve smuggled or compounded products rather than approved brand-name drugs, the scrutiny underscores the regulatory environment Viking must navigate.

Wall Street's Divide

The gap between Viking's current trading level and analyst price targets reflects a market that sees upside potential but is unwilling to pay for it before clinical data de-risks the oral program. The company has not yet disclosed specific safety data from its oral formulation trials that would resolve the debate.

Viking's cash position and pipeline breadth beyond VK2735 provide some downside protection, but the stock's valuation is largely a bet on the obesity program succeeding. The company needs to demonstrate that the oral formulation can achieve efficacy comparable to the injectable while maintaining an acceptable safety profile — a bar that has tripped up other oral GLP-1 candidates.

For investors, the question is whether the current discount to analyst targets represents a genuine opportunity or a correct read on the clinical and competitive risks. Lilly's Mounjaro cardiovascular label expansion in August gives the pharma giant additional ammunition in payer negotiations, further raising the competitive bar for any challenger. Viking's next clinical data readout will be the key catalyst that determines whether the market's skepticism is justified or overdone.

This article is for informational purposes only and does not constitute investment advice.