Weight-Loss Drug Boom Creates Winners and Wipeouts in Biotech Investing
This Yahoo Finance analysis examines the high-risk, high-reward nature of investing in weight-loss drug developers. It highlights how clinical trial results can cause massive stock swings, using Viking Therapeutics (up 500% over five years) and Skye Bioscience (down 99%) as contrasting examples. The article explains the drug development pipeline, noting that only about 8 of 100 programs reach approval, with Phase 2 being the biggest hurdle. It also covers the funding clock risk for clinical-stage biotechs and presents five ETF options for diversified exposure, noting that dedicated weight-loss funds have underperformed due to their focus on large caps like Lilly and Novo Nordisk. The piece concludes by mentioning M&A as another potential payoff, citing Lilly's acquisition of psychedelic-drug developer AtaiBeckley.
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