GLP-1s dominated the discussion in 2024 when it came to weight loss treatments.
Zealand Pharma A/S, a Danish biotechnology company, is developing what it calls “the next generation” of antiobesity therapies, with the aim to outperform the industry leaders such as Eli Lilly and Novo Nordisk over the long-term.
Zealand Pharma is currently testing Petrelintide for weight loss. It’s a long-acting analog of amylin. Petrelintide has a better tolerance profile than existing treatments such as Wegovy and Zepbound.
Since the beginning of this calendar year, shares of Zealand Pharma have nearly doubled.
Petrelintide, a possible first-line therapy for weight loss
A Phase 1b study has shown that Petrelintide is effective in reducing weight by an average 8.6%.
Adam Steensberg said in a recent interview on CNBC that:
We have every reason to think that if we can develop a weight loss molecule with a benign tolerance profile and demonstrate cardiovascular risks reduction, it could become the first-line treatment.
Zealand Pharma plans to conduct a Phase 2b study by the end 2024.
Amylin analogs are a synthetic version of a hormone that is produced by the pancreas (a large gland behind the stomach) and increases satiety.
Despite a significant rally year-to date, the stock of Zealand Pharma could rise further as it cements its place in a market with high growth, which is projected to be worth approximately $200 billion by this decade.
At the time of this writing, however, the stock did not pay a quarterly dividend.
Should you buy Zealand Pharma stock in October 2009?
Analysts at Deutsche Bank warn that while excitement about Petrelintide may be growing, much of the optimism has already been priced in.
The stock’s market cap is approximately $9 billion. This may limit its upside potential in the short term.
Last week, Deutsche Bank began coverage of Zealand Pharma, with a “hold rating” and a DKK 815 price target, which indicates only a 4% increase from the current level.
Zealand Pharma continues to grow. In the first half 2024, the company reported a revenue of DKK 49,2 million, which is more than double what it was in the same period last year.
The company completed a $1.0 Billion equity offering in June. This was a result of the strong investor interest shown in its R&D efforts and commercialization. Adam Steensberg, CEO at the time, stated:
“Backed by our solid financial position after the capital raise in July, we are making significant investments in differentiated obesity candidates in order to accelerate their development while we explore partnership options.”
This post Can this European Biotech Challenge Eli Lilly on the booming weight loss market? This post may be updated as new information becomes available
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