Can Altimmune's weight-loss drug be a game-changer?

Key Points

• Altimmune's weight-loss treatment pemvidutide phase 2 clinical trials indicate patients receiving the 2.4 mg injection lost an average of 15.6 pounds in a 48-week study, and 30% lost at least 20 pounds.
• Altimmune is looking for a global partner to collaborate on the phase 3 trials and handle the commercialization and launch of the drug upon FDA approval.
• Pemvidutide also had a profound impact on reducing liver fat and lowering LDL cholesterol levels, but no change to A1c blood sugar readings.

The runaway success of weight-loss drugs like Novo Nordisk A/S NYSE: NVO Ozempic and Eli Lilly and Co. NYSE: LLY Mounjaro has kicked off a gold rush for new weight-loss drugs in the medical sector. One of the major complaints about glucagon-like peptide-1 (GLP-1) drugs is the nausea and vomiting that comes with the usage of these drugs.

This can be severe enough to cause patients to quit treatment. This was a key reason why Pfizer had to discontinue their efforts for a twice-daily weight-loss treatment, danuglipron.

Rather than take years of research and clinical trials, big pharma is on the hunt for smaller biotechs that have shown success in clinical trials for potential partnerships or acquisitions. Altimmune Inc. NASDAQ: ALT is on the radar as a potential acquisition target based on its success in clinical trials with pemvidutide. Furthermore, they are actively looking for a global partner to help them finish their trials and launch commercialization upon FDA approval.

About Altimmune

Based out of Gaithersburg, MD, Altimmune is a clinical-stage biotech focused on developing treatments for liver diseases and obesity. Its GLP-1 candidate is pemvidutide, which has been shown to be effective in weight loss and fat loss in the liver, LDL cholesterol reduction, and blood pressure. In its phase 2 clinical trial, the average weight loss was 15.6% after 48 weeks of the 2.4 mg injection. More than 30% of the patients saw more than 20% weight loss. The drug is intended to treat non-alcoholic steatohepatitis (NASH), a chronic liver disease that can lead to fibrosis, cirrhosis and liver failure. It’s characterized by the buildup of fat in the liver.

Pemvidutide

Altimmune’s drug shows similar weight-loss results as Semaglutide, the active ingredient in Ozempic and Wegovy. The company released positive top-line results from its MOMENTUM phase 2 clinical trials. Its discontinuation rates were less than that of the placebo. Additionally, pemvidutide also showed significant loss of liver fat and better tolerability without heart rate increases. The study showed that 74% of patients finished the trials, which is better than the 61.9% of patients who had the placebo. These additional benefits make it a potential giant killer. However, unlike Ozempic and Mounjaro, there was very little effect on controlling blood sugar levels, evidenced by no change in A1c readings.

Ozempic and Mounjaro are technically type 2 diabetes treatments that also happen to trigger weight loss. The rampant off-label use was why Wegovy and Zepbound were created for the specific purpose of controlling obesity. Pemvidutide was created to target NASH, not as a diabetes treatment, to which the FDA has granted fast-track status.

Whales looking to partner and acquire?

The hunt to acquire weight-loss therapies by the big players is on. Roche Holding AG OTCMKTS: RHHBY paid $2.7 billion to acquire Carmot Therapeutics and has to pay up to $400 million in milestone payments. Carmot’s leading weight-loss treatment is called CT-388, a one-weekly injection that mimics GLP-1 and GIP hormones similar to Mounjaro. Carmot was acquired after completing very promising phase 1 trials. The drug is ready to be taken by humans in Phase 2, with a potential launch by 2030 if it can complete Phase 3 and receive FDA approval.

AstraZeneca PLC NYSE: AZN announced an agreement to pay up to $2 billion to license an experimental weight-loss pill from Chinese biotech Eccogene. Altimmune also has a chronic hepatitis B drug, HepTcell, in phase 2 clinical trials.

Altimmune analyst ratings and price targets are at MarketBeat. Altimmune peers and competitor stocks can be found with the MarketBeat stock screener.

 

Potential bull flag or reversal

The daily candlestick chart on ALT has the potential for a bull flag after forming a shooting star. The steep stock run-up sets have established the flagpole. The bull flag would have to form from lower highs and lower lows as the stock gets a breather. The daily market structure low (MSL) triggered above $3.73.

The daily relative strength index (RSI) has soared through the overbought 70-band as it appears to have peaked as it slips to the 80-band. The daily 200-period moving average support is at $4.18. Pullback support levels are at $5.53, $4.29, $3.74 MSL trigger and $2.91, just above the cash-per-share price floor level.