MW RFK Jr. is not a fan of weight-loss drugs or vaccines. Stocks are tanking.
By Ciara Linnane
Trump's pick for head of HHS is a firm opponent of the new drugs for weight loss and diabetes management
The stocks of companies that make or are developing the new class of weight-loss and diabetes-management drugs were sharply lower Friday, after President-elect Donald Trump named Robert F. Kennedy Jr. his pick to head the Department of Health and Human Services.
Kennedy is an opponent of GLP-1 drugs, which he has argued are the wrong approach to tackling the obesity crisis. Instead, he has said, the government should promote healthy eating, which would be far less expensive than the drugs, which cost thousands of dollars.
Eli Lilly & Co. Inc. $(LLY)$ and Denmark's Novo Nordisk $(NVO)$ (DK:NOVO.B), the two leaders in the GLP-1 space, are pushing to expand insurance coverage for the drugs and have been studying how they achieve benefits beyond weight loss, such as in treating cardiovascular disease and sleep apnea.
Kennedy famously blames unhealthy food, unnecessary medicines, including certain vaccines, and fluoridated water for the rise of chronic disease.
Also read: RFK Jr. would rattle health markets as head of HHS, but it's not a done deal
Chronic disease has become an epidemic in the U.S., he has said in interviews. About 75% of Americans are obese.
A scion of arguably the most famous family in Democratic Party politics, Kennedy has no health degree or formal qualification but made healthcare and what he considers the failings of the U.S. system a cornerstone of his own run for president.
"Kennedy is critical of the pharmaceutical industry and believes Americans have become too dependent on pharmaceuticals (like GLP-1s)," Raymond James analyst Chris Meekins said in a Friday note to clients.
Eli Lilly's stock was down 3% Friday, and U.S.-listed shares of Novo Nordisk were down 3.5%.
Shares of other companies working to develop weight-loss drugs also fell.
Viking Therapeutics Inc. $(VKTX)$ was down 2.8%. That company posted data in early November that showed better-than-expected results for its oral weight-loss drug in a Phase 1 trial.
For now, the GLP-1 drugs are administered by injection, but an oral version is expected to be a game changer for whichever company can develop it first, as it would be far more easily administered and would likely appeal to those who have a fear of needles.
Amgen Inc. $(AMGN)$ was down 4.7%. Amgen is developing an experimental drug called MariTide, and investors awaiting data from a Phase 2 trial were dismayed this week when a Cantor Fitzgerald analyst spotted data from a Phase 1 study suggesting the shot could be linked to a loss of bone-mineral density.
Amgen issued a statement saying it sees no link between MariTide and changes in bone-mineral density.
"The Phase 1 study results do not suggest any bone safety concern or change our conviction in the promise of MariTide," the company said.
Amgen expects to offer data from the Phase 2 trial later this year.
Structure Therapeutics Inc.'s stock $(GPCR)$ was down 5.9%. That company expects to begin a Phase 2 trial of its oral GLP-1 drug, GSBR-1290, this quarter. Structure said in June that patients taking the drug in a clinical trial lost, on average, 6.2% of their body weight after three months.
Scholar Rock Holding Corp.'s stock (SRRK) was down 3%. That company has two drugs in development that aim to preserve the lean muscle that is often lost during rapid weight loss.
The company's experimental drugs apitegromab and SRK-439 stand out among a class of investigational treatments targeting myostatin, a protein that inhibits muscle growth, which could help maintain lean-muscle mass.
Zealand Pharma's stock (DK:ZEAL) was down 8.5%. That company is developing an experimental drug called petrelintide, which is an amylin analog - a type of drug that has been shown to increase feelings of fullness and may have fewer gastrointestinal side effects than GLP-1s.
Terns Pharmaceuticals Inc.'s stock $(TERN.UK)$ was down 5.5%. Terns is also developing an oral weight-loss drug and said a Phase 1 trial achieved statistically significant weight loss of up to 5.5% over 28 days.
-Ciara Linnane
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(END) Dow Jones Newswires
November 15, 2024 11:19 ET (16:19 GMT)
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