Investors have piled into pharma and biotech companies involved in the obesity drug space in recent years -- and for good reason. The market is on track to reach nearly $100 billion by the end of the decade. Meanwhile, we've seen plenty of evidence supporting this growth forecast, from high demand for currently commercialized obesity drugs to blockbuster revenue.
Today, Eli Lilly and Novo Nordisk dominate the market with their weight loss drugs, but these aren't the only companies that may score a win for investors. Many other drugmakers are studying candidates in clinical trials and could join this high-growth market down the road. Before that happens, they might announce trial results and other progress that could spur investor optimism and result in big gains for their stock prices.
In fact, my prediction is that these two obesity drug stocks could double in 2026. Let's check them out.
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1. Viking Therapeutics
Viking Therapeutics (VKTX +3.94%) is a clinical-stage biotech specializing in treatment for metabolic diseases, so it's perfectly positioned to work in the weight loss space. The candidate everyone has been watching is VK-2735, a dual GLP-1/GIP receptor agonist that works in much the same way as the Lilly and Novo drugs.
The GLP-1 class of drugs stimulates hormonal pathways involved in processes such as managing blood sugar levels and appetite. Lilly and Novo have sold injectable formulations for the past several years, and just recently, they both won approval for oral drugs.
NASDAQ: VKTX
Key Data Points
Viking is investigating its injectable version of VK-2735 in phase 3 trials, and it aims to launch a phase 3 trial for the oral format later this year. So far, results from earlier trials have been promising, suggesting this drug could find its place in the market and generate significant revenue for the biotech company.
Viking also is conducting a maintenance dosing trial for VK-2735, focused on supporting long-term weight loss. The company expects to report data in the third quarter -- Viking stock has soared after positive data in the past -- gaining 121% in one trading session after the phase 2 report in February of 2024 -- so, if results are strong, they could send the stock higher once again.
2. AbbVie
Unlike Viking, AbbVie (ABBV +0.17%) is a pharma giant with many commercialized drugs -- including immunology blockbusters Skyrizi and Rinvoq, as well as well-known aesthetic and neurology product Botox. Together, these and other members of the AbbVie portfolio helped the company deliver a 12% increase in revenue to $15 billion in the latest quarter.
But the addition of an obesity drug down the road could prove to be a powerful addition to this portfolio. For reference, Lilly's obesity drug Zepbound brought in more than $4 billion in revenue in the recent quarter. Even if an eventual AbbVie product doesn't reach that level, it still could be a major growth lever for the company.
NYSE: ABBV
Key Data Points
AbbVie is taking an approach to weight loss that's different from those focused on GLP-1. The company is studying a long-acting amylin analog. The hormone amylin may be promising because it stimulates signals to the brain that control appetite and slow gastric emptying. An amylin drug could offer patients who may not tolerate GLP-1 drugs an option, or eventually it might even be paired with a GLP-1 for increased performance.
AbbVie reported positive results from a phase 1 dosing study of ABBV-295 earlier this year. Weekly dosing over 12 weeks and dosing every other week over 13 weeks resulted in weight loss in the range of more than 7% to more than 9%, supporting continued development of the candidate.
Any further reports from the trial, as well as AbbVie's overall growth from its full portfolio of products, could act as catalysts for the stock -- and that's why my prediction is this stock, trading at only 15x forward earnings estimates, down from more than 24x several months ago, may have plenty of room to run and could even double this year.
