Amgen's Weight Loss Hope Falters as MariTide Disappoints

Amgen Inc. (AMGN), a leading biotechnology company, experienced a significant setback on Tuesday as investors reacted negatively to the Phase 2 trial results of its experimental weight loss drug, MariTide. The stock fell over 10%, its largest single-day decline since October 2000, as the drug failed to meet investor expectations.

MariTide, a monthly or less frequent injection, demonstrated up to 20% average weight loss at 52 weeks for people with obesity or overweight without Type 2 diabetes, and up to 17% for those with diabetes. While these results are clinically meaningful, they fell short of Wall Street's expectations, which ranged from 20% to 25% weight loss in the phase two trial.

The drug's safety profile also raised concerns, with a higher discontinuation rate due to side effects in the dose escalation arms (around 11%) compared to Zepbound's Phase 3 trials (7%). Gastrointestinal-related adverse events, such as nausea and vomiting, were the most common, with nausea and vomiting resolving within a median of six days and one to two days, respectively.

Despite the disappointing results, Amgen plans to initiate a Phase 3 clinical program for MariTide, including trials in various obesity-related conditions. The company's chief scientific officer, Jay Bradner, expressed confidence in the drug's potential, stating that the results provide evidence for the differentiated profile of MariTide.

However, investors seemed unconvinced, driving Amgen's stock to its lowest close since April 18, 2024. The stock's decline is on pace to be the largest percent decrease since October 2000 and the worst two-day stretch since March 12, 2020.

The weight loss market is highly competitive, with established blockbusters like Novo Nordisk's Wegovy and Eli Lilly's Zepbound already showing success. MariTide's main differentiation lies in its less frequent dosing, but potential safety concerns and lower weight loss compared to Wall Street's expectations may pose challenges for Amgen in securing a significant share of the obesity drug market.

In conclusion, Amgen's MariTide failed to meet investor expectations in its Phase 2 trial, leading to a significant decline in the company's stock price. While the drug demonstrated clinically meaningful weight loss, its safety profile and lower weight loss compared to expectations raised concerns among investors. Amgen's plans for a Phase 3 clinical program for MariTide will face a competitive landscape, and the company must demonstrate the drug's effectiveness and safety to secure a substantial market share.