Viking Therapeutics (VKTX) stock toppled Tuesday after the biotech company inked a $150 million manufacturing deal for its weight-loss drug, VK2735.
The deal likely signals Viking isn't open to entertaining a takeover deal in the near future.
↑ X NOW PLAYING The Weight-Loss Drug Market Is Hot. Which Medical Stock Will Win The Battle For Supremacy?William Blair analyst Andy Hsieh was "enthusiastic" about the deal. CordenPharma, a contract development and manufacturing organization, will be able to fill and pack up to 100 million autoinjectors, 100 million vials and syringes and make more than 1 billion oral tablets.
In turn, Viking will make prepayments amounting to $150 million over the next three years.
"We acknowledge that investors could view the deal as a negative development with respect to Viking's takeout prospects; however, we do not share this view," Hsieh said in a report. "Given the importance of procuring (active pharmaceutical ingredient) and he associated devices and accessories, we argue it would be imprudent to delay such discussions even if Viking was theoretically in late-stage discussions with an acquirer."
But Viking Therapeutics stock slipped more than 6% to 26.12 in early morning trades.
More to follow.
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