Check out the latest Viking Therapeutics earnings call transcript.

What happened

The Nasdaq Biotechnology Index fell 11.2% in December, and clinical-stage companies, like Viking Therapeutics (NASDAQ:VKTX) fell harder than their established peers. The company didn't have anything to say last month, but that didn't stop its share price from tumbling 32.2% last month, according to data from S&P Global Market Intelligence.

So what 

Viking Therapeutics has been quiet since reporting 12-week data from a non-alcoholic fatty liver disease (NAFLD) study with its lead candidate. VK2809 is a thyroid beta-receptor (TRB) agonist, similar to one in later-stage development from Madrigal Pharmaceuticals (NASDAQ:MDGL) called MGL-3196. Viking's TRB-agonist appears more effective than Madrigal's, but it's hard to say which is better because they were tested on different patient populations.

Guy in a suit drawing a downward sloping chart.

Image source: Getty Images.

Many patients with NAFLD progress to a state of chronic inflammation called non-alcoholic steatohepatitis (NASH). This condition threatens the lives of an estimated 20 million Americans right now, and there aren't any available treatments yet. The first TRB-agonist approved to treat NASH will almost certainly become a blockbuster drug, although there's probably plenty of room for me-too drugs.

Now what

Viking expects to initiate further clinical studies with VK2809 this year, but the company hasn't yet provided a timeline.  

Since NASH progresses too slowly to wait for outcome studies, the FDA is willing to review a candidate that reduces inflammation without worsening fibrosis, or vice versa. Viking's candidate helped two-thirds of a small group of NAFLD patients achieve a 50% or better liver fat reduction, but these patients didn't have any inflammation or fibrosis to work with.

Until we see results from studies with similar patients, comparisons between Madrigal's and Viking's TRB-agonists need to be taken with a grain of salt.