Viridian's TED Drug Approval Challenges Amgen's Tepezza

What happened

The FDA approved Viridian Therapeutics' Lumvoa for thyroid eye disease, directly competing with Amgen's Tepezza. This approval introduces a new branded rival in a market that was already showing signs of slowing growth for Tepezza. In Q4 2025, Tepezza underperformed expectations, raising concerns about the Horizon acquisition's ability to offset legacy drug erosion. The DeepValue report flagged Tepezza volatility as a key risk, and this development reinforces that risk by adding a well-funded competitor with a differentiated profile. Amgen now faces the prospect of a two-front battle: defending Tepezza's market share while simultaneously managing price and volume pressure on its mature franchises.

Implication

The approval of Lumvoa materially increases competitive pressure on Tepezza, which was already showing signs of deceleration. For Amgen, this means the Horizon assets may not deliver the incremental growth needed to fully offset the steep declines in Enbrel, Otezla, and Prolia. The DeepValue report's base case already assumed moderate Tepezza growth, but with a new competitor, the bear case becomes more likely. Investors should monitor Tepezza's market share trajectory and revise their peak sales estimates downward. This development adds another layer of uncertainty to Amgen's already stretched valuation, which relies heavily on successful execution from its growth portfolio.

Thesis delta

The Viridian approval shifts the competitive landscape for Tepezza from a near-monopoly to a duopoly, increasing the probability that Horizon assets underperform the base case. This directly challenges the DeepValue report's assumption that Horizon growth would help offset legacy erosion, and tilts the risk-reward balance further toward the bear case. The thesis now incorporates a higher likelihood of Tepezza revenue erosion, which reduces the margin of safety at current share prices.