Amgen's experimental drug MariTide helped overweight or obese patients shed up to 20% of their body weight in a mid-stage trial, but the results failed to meet lofty investor expectations and shares of the biotech company fell 4.8% on Tuesday.
The year-long trial involving 592 people tested several different doses of the drug as a monthly or bi-monthly injection. Amgen said it also planned to study quarterly dosing.
Analysts said the weight-loss benefit was in line with currently available once-weekly injected drugs from Novo Nordisk (NOVOb.CO) and Eli Lilly (LLY.N), while Amgen's drug had slightly more side effects.
Novo's Wegovy led to 15% weight loss over 68 weeks, while Zepbound helped patients lose more than 22% of weight over 72 weeks in trials.
Trial data showed that about 11% of patients on MariTide dropped out of the study due to adverse side effects. That compares with about 6% discontinuations in late-stage studies of Zepbound, said J.P. Morgan analyst Chris Schott.
Amgen said nausea and vomiting events were mild and substantially reduced as the dose escalated.
"While Maritide is clearly effective and will offer less frequent dosing, the bar for efficacy in the class continues to move higher," Schott said.
He added that the Street expects Novo and Lilly's experimental drugs - CagriSema and retatrutide - to deliver a minimum of 25% weight loss.
Shares of Amgen fell 4.8% to $280.01 at close, erasing more than $7 billion from the Dow component's market value.
"The market reaction reflects disappointment over MariTide results that weren't quite as good as hoped. There could have been quite a high whisper consensus," said Alexander Jenke, a portfolio manager at Munich-based Medical Strategy, which manages 1.2 billion euros ($1.26 billion) in assets.
Still, Amgen is betting on the drug to grab a slice of the potential $150 billion obesity treatment market as MariTide could offer patients a more convenient dosing option over existing treatments.
"As a physician, I've never met a patient who prefers more injections. Think about that 52 injections down to potentially 12 or fewer," Amgen's chief scientific officer, Jay Bradner, said on a call with reporters.
Wegovy targets receptors for the appetite- and blood sugar-reducing hormone known as GLP-1, while Lilly's Zepbound stimulates GLP-1 and a second gut hormone called GIP.
Amgen's MariTide, while still several years away from a launch, has a different approach. It is an antibody linked to a pair of peptides that activates the GLP-1 receptor while simultaneously blocking the GIP receptor.
Novo's CagriSema is a two-drug combination treatment that targets the same gut hormone as Wegovy, but also targets a pancreas hormone called amylin. Its late-stage data is expected by end of 2024.
Lilly's retatrutide, currently in late-stage development, targets GLP-1, GIP and the body's receptors for a third hormone, glucagon.
The mid-stage study also showed no association between the drug and bone mineral density changes, after such concerns from early-stage data wiped off more than $12 billion from its market value.
In the study, obese or overweight patients with Type 2 diabetes, who typically lose less weight on GLP-1 therapies, achieved up to about 17% weight loss on average, Amgen said.
In patients with and without diabetes, a "plateau" was not observed, indicating potential for further weight loss beyond 52 weeks, Amgen said. Jenke said this was a promising aspect of the study.
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