Amgen shares soar as executives outline obesity drug push

Dive Brief:

• Amgen shares soared by double digits Friday following its announcement an obesity drug it’s developing has shown enough promise to warrant advancing into late-stage testing.
• On an earnings call with analysts Thursday, CEO Robert Bradway said the company is “confident” in the drug’s “differentiated profile” following an internal review of interim Phase 2 study results. Full data are expected by the end of the year and should support a subsequent move into Phase 3 trials, executives said.
• Yet Amgen’s drug is likely at least two years away from regulators’ desks, by which time Eli Lilly and Novo Nordisk may already have successors to their weight loss medicines Wegovy and Zepbound. It will take even more time to accumulate data to prove the drug can protect heart health, a key claim for convincing commercial and federal insurers to reimburse for treatment.

Dive Insight:

Amgen’s market capitalization swelled $20 billion following the announcement, a surge that reflects intense investor interest in emerging weight loss medicines.

The biotech’s lead drug, called maridebart cafraglutide or MariTide, acts on the same targets that Zepbound does, hormones called GLP-1 and GIP. But unlike Zepbound, MariTide blocks, rather than stimulates, GIP. Amgen also aims to show the drug can effectively cut weight with a once-monthly shot, instead of the weekly injections required for Zepbound and Wegovy.

But there’s little known publicly about the drug’s potential.

“We’ve just seen really a small amount of data. So probably anything is possible and, like you, we will be interested to see their results,” said Lilly’s top scientist, Daniel Skovronsky said on an earnings call earlier this week. “We’ve placed our bets, and we like the data we got.”

Amgen, though, is now expressing enough confidence to warrant making a substantial investment in late-stage studies. During the conference call Thursday, executives didn’t disclose specific data, but said all 11 study arms of the two-stage, placebo-controlled trial remain active. They also said there “has not been an issue” with patients stopping treatment due to side effects.

The trial enrolled people with obesity or who are overweight and have another health condition. Diabetics were tested separately to better understand the drug’s effects on people with the disease.

Amgen executives have viewed the interim data, but trial investigators and participants are still “blinded” to preserve the trial’s scientific integrity, they said. The company is stopping work on another obesity drug prospect, AMG 786, as early data showed it doesn’t have the same potential as MariTide.

Should MariTide advance into Phase 3, it would likely need to be tested in a trial lasting more than a year, just as Wegovy and Zepbound were. To be competitive, Amgen also will need run the type of large, multiyear trial that can prove whether MariTide protects heart health.

In the meantime, Novo and Lilly will be able to further entrench their drugs on the market. Already, they’ve made significant inroads, with Wegovy recording $1.3 billion in sales in the first quarter and Zepbound $517 million. Both are also seeing prescription numbers climb and are investing heavily in manufacturing.

In addition, both Novo and Lilly are nearing Phase 3 readouts for successor drugs, which, if positive, could raise the bar for would-be competitors.

“I think they will remain the dominant players — not only given existing leadership position but also because of the rebate wall they have constructed,” Umer Raffat, an analyst with Evercore ISI, wrote in a note to clients.

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