Replies to post #248207 on Biotech Values

[DewDiligence]

VKTX—New $200M ATM with Stifel et al:

https://www.sec.gov/Archives/edgar/data/1607678/000095017023034818/form_s-3_asr_2023.htm (scan past the shelf registration to separate section of filing regarding the ATM)

[Mufaso]

Dew- Thanks for the comments on the VKTX cc. Most of the call seemed to be focused on the weight loss opportunity and specifically the Oral version of VK2735. I came away very encouraged and believe that when the tolerability data comes out in ph2/3 studies, VK2735 will be more than competitive with Lilly’s Mounjaro (or their possible Triple GGG ) in Sub-q dosing. and could possibly be the best in class oral weight loss drug.

VKTX’s oral formulation of VK2735 is expected to have at best ~60% of the weight-loss efficacy of the injected formulation, according to VKTX’s 2Q23 CC

I think that if the VK2735 oral version gets 60% of the weight loss the sub-q version gets, Viking will be very happy. The sub-q version got up to 7% weight loss in 28 days in the p1! Note that all the discussion in the cc was hypothetical based on animal models where Viking was trying to see if there was an oral effect at all. It remains to be seen in the current ph1 oral trial what the actual effect is in a short time along with tolerability data. Longer term I see the oral version as mostly a maintenance drug rather than an initial weight loss regimen although if there is no plateauing observed (in later trials) in may very well be the choice for many. (Dew - Do you concur or do you see it differently?)

The oral formulation may also have a fasting requirement. When asked about this on the CC, management said this detail has not been disclosed, which implies that there is or may be a fasting requirement. (If there were definitely no fasting requirement, management would presumably have said so.)

Agreed- although management's actual comments indicated that it would be q.d. dosing and that they didn’t think any needed dietary restrictions would be “particularly problematic”. If it turns out to be like Rybelsus, I don’t think the restrictions would matter much especially if weight loss and tolerability of oral VK2735 were good. For reference, my understanding is Rybelsus is best taken on an empty stomach when you first wake up, at least 30 minutes before food, and with a small amount of water (no more than 4 oz). This ensures Rybelsus is absorbed properly. After 30 minutes of taking the Rybelsus tablet, you may eat, drink or take other oral medicines.

As for other items I found interesting in the CC related to the oral VK2735 study the CEO made:

...the oral formulation would be five arms. It will be placebo, and then four escalating dose arms. We do have flexibility to add arms in that study if we'd like, just like in the SubQ study at cohort .

With respect to the doses that are planned, I think we said previously we're looking at 2.5 milligrams per day,5 milligrams per day, 10 milligrams per day, and then 20 milligrams per day and so, those would be the planned doses, and then if we make any changes, we have some flexibility there in the protocol.

And finally I thought this exchange was very telling:

Yale Jen
... the recent meeting that the GGG product, at least on the SPC side seems to be very promising. My question to you is that it was adding glucagon agonist, it was something for you guys to consider, or you feel this is probably not necessarily the best strategy forward and I have another follow-up.

Brian Lian
Yeah, thanks, Yale. We have looked at the triple agonist here and in our hands, we couldn't get them to outperform the dual agonist, the target, the GLP1 and GIP. What we do see from some of the data on the triple agonist compounds is that the incremental benefit on weight loss is it's there, it's relatively modest given the, I think, significant change in the adverse event profile. So with elevated hypersensitivity and potentially concerns on cardiac safety, we'll see how those pan out long term, but those would be potential challenges that may or may not be worth it in every patient. So right now, we're looking at the GLP1 GIP dual agonist. There may be other mechanisms outside of glucagon that could be layered on to those two and provide a very nice enhancement of the signal.