Amgen soars 16% after it talks up a new weight loss drug that could be injected monthly instead of weekly

Goldman Sachs said Amgen's experimental GLP-1 drug could have peak sales of $5 billion, or 5% of the estimated $100 billion weight loss drug market.

• Amgen stock soared as much as 16% on Friday after it reported first-quarter earnings.
• The company talked up its experimental GLP-1 weight-loss drug, MariTide.
• The new weight loss drug could be injected monthly instead of weekly.

A new experimental weight-loss drug helped spark a 16% rally in Amgen stock on Friday.

The pharmaceutical giant reported first-quarter earnings that beat analyst estimates. It also tweaked its 2024 revenue and profit guidance slightly higher, but investors were more focused on an update about the company's pipeline development of a GLP-1 weight loss drug called MariTide. 

The drug just wrapped up its phase two trial and Amgen said it is in the beginning stages of moving the drug into a phase three trial.

"We are very encouraged with the results that we've seen thus far and with the conduct of the trial," Amgen CEO Robert Bradway said on the company's earnings call.

The competition is fierce in the GLP-1 weight loss market, with Novo Nordisk's Ozempic and Wegovy and Eli Lilly's Mounjary and Zepbound dominating sales. But demand is so strong that supply has been constrained, and Wall Street analysts believe the total addressable market for treating obesity in America is so massive that more than two companies will likely succeed.

That's where Amgen could come in, as Bradway said its experimental weight-loss drug is "differentiated" and "will address important unmet medical needs."

Perhaps the biggest difference between Amgen's MariTide and the current weight loss drugs on the market is that MariTide could be injected monthly due to its long-acting nature, rather than having to be injected weekly like Ozempic and Mounjaro.  

"We expect to deliver MariTide in a convenient handheld, patient-friendly auto-injector device with a monthly or even less frequent single-injection administration, assuming eventual approval," Amgen chief scientific officer James Bradner said on the earnings call.

Amgen said it is on track to release top-line data from MariTide's phase 2 trial in late 2024. 

Goldman Sachs said in a note on Friday that the market is estimating Amgen's MariTide will have peak sales of $5 billion, or about 5% of the $100 billion obesity market, if it's eventually approved.

A monthly or less frequent injection would improve the convenience factor for patients, but it would also help ease the supply constraints of GLP-1 weight loss drugs.

That's because much of the shortage of the drugs hasn't been caused not by manufacturing the active ingredient of the drug, but rather manufacturing and filling the technically complex auto-injectors. Fewer injections each year for patients means fewer auto-injectors, which should help more people secure access to the popular drugs.

While a monthly weight-loss injected drug may sound appealing to patients, it is likely still far from hitting the market, assuming it passes all of its clinical trials. 

And even more convenient than a monthly injection of GLP-1 would be a weight loss pill, though Amgen said it ditched development of its oral weight loss drug candidate to instead focus on the development of MariTide.