Shares of Denmark’s Zealand Pharma surged after the company unveiled robust results from a trial of a liver disease treatment that has been heralded as a potential contender in the burgeoning weight-loss drug market.
The Phase 2 trial of the survodutide drug revealed that 83% of adults experienced positive outcomes for a form of liver inflammation caused by excess fat cells known as “MASH,” the company disclosed in an announcement on Monday.
The drug has “demonstrated efficacy” in individuals with obesity and is presently undergoing five Phase-3 trials in a clinical program for those who are overweight or obese. It has garnered fast-track designation from the U.S. Food and Drug Administration.
Analysts seized upon the drug’s potential in obesity research following the latest test results, which affirmed the safety of the highest dosage utilized in that trial.
Shares of Zealand Pharma surged by 30% by 10:53 a.m. London time, driven by optimism for the company’s prospects in the highly profitable obesity market that propelled fellow Danish drugmaker Novo Nordisk to become Europe’s most valuable firm on the back of its development of Ozempic and Wegovy. Several other companies, including Eli Lilly, Roche, and AstraZeneca, are also vying to compete in the sector.
“Top-line results demonstrated an improvement in MASH, at all doses explored in the trial. Treatment with survodutide did not show unexpected safety or tolerability issues, including at the higher dose of 6.0 mg,” remarked Michael Novod, head of bank Nordea’s healthcare equity research team, in a Monday note, lauding the latest Zealand Pharma results as an “unequivocal win for survodutide.”
“Importantly, the [Phase 2] MASH trial also tells us that the 6mg dose is safe, which is the top dose used in the ongoing [Phase 3] obesity trial too,” he added.
Analysts at Jefferies evaluated that Zealand Pharma’s “position as a key player in the next wave of obesity therapeutics is underappreciated,” underscoring the significance of the German co-inventor Boehringer Ingelheim’s announcement that the drug will advance as “quickly as possible” with treatment on liver diseases and related conditions.
Pharmaceutical firm Boehringer Ingelheim is financing and overseeing the clinical development of survodutide.
