Small & Mid-Cap Healthcare Preview

About Viking Therapeutics

Viking Therapeutics, Inc., a clinical-stage biopharmaceutical company, focuses on the development of novel therapies for metabolic and endocrine disorders. The company's lead drug candidate is VK2809, an orally available tissue and receptor-subtype selective agonist of the thyroid hormone receptor beta (TRß), which is in Phase IIb clinical trials to treat patients with biopsy-confirmed non-alcoholic steatohepatitis, as well as NAFLD.

It also develops VK5211, an orally available non-steroidal selective androgen receptor modulator that is in Phase II clinical trials for the treatment of patients recovering from non-elective hip fracture surgery; VK0612, an orally available Phase IIb-ready drug candidate for type 2 diabetes; VK2735, a novel dual agonist of the glucagon-like peptide, which is in Phase 1 SAD/MAD clinical trial, and VK0214, an orally available tissue and receptor-subtype selective agonist of the TRß for X-linked adrenoleukodystrophy. The company was incorporated in 2012 and is headquartered in San Diego, California.

VKTX operates in the Manufacturing | Pharmaceutical Products | headquartered in SAN DIEGO, California | approximately 20 employees | led by CEO Brian Lian.

Sector Report: Small & Mid-Cap Healthcare
Date: January 26, 2026
Analyst: Priyum Daga

Finding Value in the "Forgotten" Middle

Executive Summary

The healthcare sector has quietly split in two. Capital keeps flowing heavily into the mega-cap pharmaceutical names and the dominant MedTech incumbents, while large swaths of the small and mid-cap universe continue to trade at depressed levels after an extended period of derating.

This bifurcation has produced one of those infrequent opportunities: a group of smaller companies where fundamentals are visibly improving and near-term catalysts are clear, yet the market continues to price them as though capital remains scarce and strategic interest is dormant.

Against that backdrop, we’ve selected ten small and mid-cap healthcare names that stand out for the combination of attractive valuation, strategic positioning, and tangible upcoming catalysts. These are ranked explicitly by our view of valuation upside and level of conviction and not simply by headline return potential or narrative momentum.

The 2026 Sector Watchlist

Detailed investment models and catalysts for Stocks #2–#10 are available below for free subscribers.

1. Viking Therapeutics (VKTX): The Pure-Play Obesity Bet

The Thesis:

We don’t assign Economic Moats to clinical-stage biotech companies. Viking stands out, however, as a differentiated pure-play obesity exposure with rising strategic relevance. Lead asset VK2735 delivered 12.2% mean weight loss over 13 weeks in Phase 2, comparable to approved GLP-1s. Its dual GLP-1/GIP mechanism could provide clinical and commercial differentiation down the line.

Phase 3 VANQUISH-1 enrollment is complete; VANQUISH-2 should wrap in early 2026. Cash reserves are sufficient to reach a potential 2027 NDA filing, minimizing near-term financing risk. Recent obesity M&A has created a valuation benchmark for late-stage assets, and Viking trades at a clear discount to those levels.

Bulls Say

VK2735’s efficacy positions Viking as a credible challenger in the fast-expanding obesity market either as an independent player or acquisition target.

Bears Say

The story remains binary. Oral formulation tolerability issues plus Phase 3 risks could cause significant capital impairment on disappointing data.