The Next Orphan Drug Multibagger and Future Obesity Champion?

By Dave Williamson and Michael Douglass – Jun 30, 2014 at 6:03PM

NASDAQ: ZFGN

Zafgen

Zafgen's arrival on public markets shakes up the obesity drug war

The newest kid on the biotech block is Zafgen (ZFGN), which successfully IPO'd this month. Shares popped over 20% on its opening day and have held strong since.

Zafgen has a small pipeline, but it does have a drug for Prader-Willi Syndrome, an orphan disease with an unmet need, in late-stage development. In addition to the excitement that beloranib could treat this genetic disorder, there is the added benefit its unique mechanism could make it an incredible obesity fighter as well.

In this episode of Market Check-Up, The Motley Fool's health care-focused investing show, analysts David Williamson and Michael Douglass discuss Zafgen's pipeline, its lead drug potential, and why investors in obesity stocks Orexigen (NASDAQ: OREX) Arena (ARNA), and VIVUS (VVUS) should be concerned about the newest entry to the obesity drug wars.

David Williamson owns shares of AbbVie. Michael Douglass and The Motley Fool have no position in any of the stocks mentioned. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.