Skye Bioscience, Inc. Common Stock

The weight-loss drug boom is producing both massive winners and near-total wipeouts among clinical-stage biotech companies, as a single trial result can send a stock soaring or crashing. Viking Therapeutics has gained more than 500% over five years after its obesity drug cleared a major mid-stage trial and advanced into final-stage testing, while Skye Bioscience has lost roughly 99% over the same period after its competing drug missed the main goal in a standalone test, falling more than 60% in one day. The high-stakes nature of drug development means only about eight of every 100 programs that enter initial safety testing ultimately win approval, with Phase II serving as the biggest hurdle where most failures occur. Investors also face funding-clock risk, as cash-burning companies may dilute existing shareholders before reaching the next milestone. Exchange-traded funds offer a way to spread these risks, with the SPDR S&P Biotech ETF and the ALPS Medical Breakthroughs ETF each gaining about 25% this year, roughly double the return of the iShares Biotechnology ETF, while dedicated weight-loss funds have largely missed the surge because they lean toward large drugmakers like Eli Lilly and Novo Nordisk.