Viking Therapeutics vs. Eli Lilly: Risky Reward in Weight Loss Drugs or Steady Pharma Growth?

The weight loss drug market is booming, driven by rising obesity rates and the success of GLP-1 receptor agonists like Novo Nordisk's Wegovy and Eli Lilly's Zepbound. For investors, the question is: Should they bet on Viking Therapeutics (VKTX), a high-risk, high-reward biotech racing to commercialize its Phase 3 candidate VK2735, or on Eli Lilly (LLY), the established pharma giant with proven revenue streams and a robust pipeline? This analysis breaks down the risk-reward profiles of both companies.

Viking Therapeutics: The High-Risk, High-Upside Play

Viking Therapeutics is a classic “all-in” biotech story. Its lead asset, VK2735, a dual GLP-1/GIP receptor agonist, is currently in Phase 3 trials for obesity (VANQUISH-1) and type 2 diabetes (VANQUISH-2). The Phase 2 VENTURE study showed impressive results: patients on VK2735 achieved 14.7% weight loss from baseline after 13 weeks, with safety data showing only mild gastrointestinal side effects.

Why it's exciting:
- VK2735's dual mechanism could offer superior efficacy over monotherapy GLP-1 drugs like Wegovy.
- The obesity market is projected to hit $55.25 billion by 2034, and a successful Phase 3 could position Viking for rapid adoption.
- Acquisition speculation: If VK2735 meets endpoints, a buyout by a Big Pharma player (e.g., Pfizer, Sanofi) becomes plausible, potentially tripling Viking's valuation.

Key Risks:
- Trial failure: Phase 3 outcomes are uncertain. Competitors like Novo's Cagrisema and Lilly's retatrutide have shown even higher weight loss in trials.
- Regulatory hurdles: GLP-1 drugs face scrutiny over cardiovascular safety, though VK2735's Phase 2 data showed no major red flags.
- Execution risk: Viking has no commercial infrastructure; success hinges on partnerships or a buyout.

Eli Lilly: The Steady Pharma Leader with Pipeline Depth

Eli Lilly dominates the obesity drug market with Zepbound (tirzepatide), which generated $2.31 billion in Q1 2025 alone, outpacing Novo's Wegovy. Its pipeline includes:
- Orforglipron: An oral GLP-1 agonist with Phase 3 data showing 16% weight loss in diabetes patients, slated for FDA submission by late 2025.
- Retatrutide: A triple-acting GLP-1/GIP/glucagon agonist that delivered 24.2% weight loss in Phase 2 trials, positioning it as a potential blockbuster.

Why it's reliable:
- Proven revenue streams: Zepbound and Mounjaro (for diabetes) are already cash cows.
- Diversified pipeline: Beyond obesity, Lilly's oncology and neurology drugs (e.g., imlunestrant for breast cancer) add stability.
- Manufacturing scale: Lilly has invested $50 billion in U.S. manufacturing to avoid supply constraints.

Key Risks:
- Competitive pressures: Novo and other entrants (e.g., Roche's tirzepatide oral formulation) could erode Zepbound's lead.
- Pricing battles: Payers may push back on high list prices for GLP-1 drugs.
- Regulatory delays: While unlikely, setbacks in orforglipron's approval could slow growth.

Risk-Reward Analysis: Which is the Better Bet?

Factor	Viking Therapeutics	Eli Lilly
Upside Potential	300%+ return if VK2735 succeeds and is acquired.	15–20% annual growth via existing drugs + pipeline.
Downside Risk	Stock could plummet 50%+ if trials fail.	Minimal downside; stock is less volatile.
Time Horizon	2–3 years until commercialization (if all goes well).	Immediate growth, with pipeline wins in 2025–2026.
Market Position	High-growth niche player.	Market leader with scale and diversification.

Investment Takeaways

• Aggressive investors: Viking Therapeutics is a “swing-for-the-fences” play. A successful Phase 3 and partnership could deliver outsized returns, but failure would be catastrophic. Monitor Phase 3 readouts (expected late 2025/2026).
• Conservative investors: Eli Lilly offers steady growth with minimal risk. Its pipeline depth and manufacturing scale make it a safer choice for long-term portfolios.

Final Verdict:
- Buy Viking if you can tolerate high volatility and believe VK2735 will outperform in Phase 3.
- Hold Eli Lilly for consistent returns and exposure to the booming GLP-1 market.

The weight loss drug race is wide open, but the choice between these two companies ultimately depends on how much risk you're willing to take for potential reward.