Pfizer has thrown money at its obesity R&D problem. Having seen its internal assets flounder, the Big Pharma has struck a deal to buy Metsera for an initial $4.9 billion to secure a pipeline of injectable and oral drug candidates, with a further $2.4 billion also on the table.
Metsera is advancing a pipeline led by MET-097i, an injectable GLP-1 receptor agonist that could support monthly dosing. MET-097i is in phase 2b. The biotech’s clinical-phase pipeline also features a monthly injectable amylin analog, which could be combined with MET-097i, and an oral GLP-1 that is designed to drive more weight loss than small molecules and avoid the scalability challenges of other oral peptides.
Writing before the deal was confirmed, BMO Capital Markets analysts told investors that Metsera’s R&D pipeline is differentiated but is yet to be derisked by a large data set. With that caveat, the analysts were positive on Pfizer’s decision to reenter the obesity market “in a meaningful way.”
“Such a deal appears logical given the company's continued interest in the obesity landscape following underperformance of its own assets (danuglipron and lotiglipron),” the BMO analysts said. “If acquired, Metsera's pipeline of obesity therapeutics could meaningfully make Pfizer a more credible threat in the obesity landscape with Metsera's long-acting injectable and oral agents.”
Pfizer and Metsera have agreed to a contingent value right (CVR) to manage the uncertainty about how the acquired candidates will perform in large studies. As well as a guaranteed $47.50 per share upfront, Metsera shareholders will receive a CVR worth up to $22.50 per share.
The CVR covers three clinical and regulatory milestones. Pfizer will pay $5 per share after the start of a phase 3 trial of the GLP-1-amylin analog combination. A further $7 per share is tied to FDA approval of the injectable GLP-1 as a monotherapy. Metsera shareholders will receive the final $10.50 per share if the FDA approves the GLP-1-amylin analog combination.
Hitting all three milestones will swell the value of the deal to $7.3 billion. In that scenario, Pfizer could be a threat to Eli Lilly and Novo Nordisk. The combination of MET-097i and the amylin analog MET-233i may be more convenient than incumbent injectables, by virtue of its monthly dosing, and potentially more effective because of its dual mechanism.
Buying Metsera will also make Pfizer a player in the oral GLP-1 market, where its own efforts have been thwarted by safety signals. The biotech is developing an oral peptide. Novo is closing on the approval of its own oral peptide. Metsera has identified a lower, more scalable dose as one way to differentiate its asset. Lilly is leading the oral small molecule space, but peptides may be more effective.