Twitchy Investors React to a Monthly Obesity Medicine
Yesterday, Amgen released topline data on their remarkable monthly obesity medicine – MariTide or maridebart cafraglutide. To us, the results are impressive, albeit preliminary. In 52 weeks of study, patients with obesity or overweight lost approximately 20% of their initial body weight and even after a year, they appeared to still be losing weight. For patients who also had diabetes, the number was 17% – consistent with the fact that such patients tend to lose less weight with any intervention.
Also impressive is that the drug appeared to be exerting an effect for as long as 150 days after the last dose. This opens up the possibility that even less than monthly dosing might work – especially for long-term care. In our view, this could become very important.
But none of this was quite good enough for twitchy investors who sent the stock price of Amgen down by ten percent when the news broke. By the end of the trading day, the overreaction was obvious and the stock regained half of that loss.
Unique Drugs Are Risky
On one hand, we understand the twitchiness. Many dimensions of MariTide are unique. It is a complex molecule that combines two GLP-1 agonist peptides with a monoclonal antibody for GIP. Other drugs for obesity (e.g. tirzepatide) activate GIP. MariTide blocks it. So yes, MariTide is very different from everything else in this space.
Amgen may be very smart, but they are certainly not playing it safe with this drug. Hence the twitchiness.
There will be plenty of opportunities for this drug to fail as development progresses. It will take time. Planning for pivotal phase 3 studies is not yet complete and the studies will take years. Especially with very different dosing and a new mechanism of action – not fully understood yet – the risks are high.
The Possibility of High Rewards
On the other hand, rewards for a highly differentiated product can be high, too. People do not like taking medicine for obesity. The chronic nature of this disease does not sit well and taking medicine all the time for it is an unpleasant reminder.
So it may turn out that needing a dose infrequently could be a big advantage from the perspective of persons living with obesity. We are thus inclined to agree with Goldman Sachs analyst Salveen Richter who sees MariTide as “a highly differentiated asset and remains confident in the outlook” for this unique drug in development.
Click here for the Amgen’s announcement, here for their presentation to investors, here, here, and here for further perspective.
Anxiety, photograph by Laurent Virzi, licensed under CC BY-SA 3.0
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November 27, 2024
