Pfizer’s new obesity strategy: Venmo $7.3B and pray.

After two straight clown-shoes performances in the obesity drug race, Big Pharma’s favorite COVID cash vacuum finally decided to stop pretending it could innovate and just do what every rich kid I went to college with did: buy someone else’s homework. Pfizer (PFE +1.5%) announced this morning it’s blowing $7.3 billion on Metsera (MTSR +62%), because apparently the fastest way to stop Eli Lilly and Novo Nordisk from lapping you is to show up with a suitcase of cash and hope nobody notices you’re late.

As for the dirty deets of the deal… Pfizer is paying $47.50 per share in cash (a 43% premium) to get Metsera’s pipeline of “maybe, hopefully, please-God-work” weight-loss drugs. The deal also comes with an extra $22.50 per share in contingent payouts if Metsera’s experimental medicines actually deliver, which could bring the total value to $70 a share. “So you’re saying there’s a chance?”

For context, Metsera was founded in 2022, went public earlier this year, and has already convinced Pfizer to bet billions on a lineup that includes a GLP-1 injectable called MET-233i, which shaved off up to 8.4% of body weight in just 36 days during early trials… potentially better than Lilly’s Zepbound on dosing convenience since it’s monthly instead of weekly. There’s also a monthly amylin-targeting drug that could hit weight loss through a different hormone pathway, and two oral GLP-1 candidates waiting in the wings.

(Source: CNBC)

Up until now, though, Pfizer’s been a complete tire fire. Last year, it killed one candidate for liver issues, then axed another in April for safety concerns. Investors were starting to wonder if Albert Bourla should switch to selling SlimFast at Target (right next to Joanna Gaine’s $100 Mason Jar flower vases). Instead, he whipped out the company Discover card. Metsera gives Pfizer a fighting chance to become something more than a covid punchline. Analysts at Leerink and JPMorgan are already penciling in $5B+ in peak sales, assuming this stuff doesn’t implode in Phase 3 trials like Pfizer’s last couple duds.

Investors lit cigars… Metsera popped 62% on the news, and Pfizer, shockingly, saw green for once (still down 27% since 2020 btw).

Is Pfizer late? Absolutely. But to me, being tardy isn’t the crime here… it’s whether $7.3B just bought them a future blockbuster or the biotech equivalent of a Shake Weight. Metsera’s early data shows promise, but so did half the “miracle” drugs now decomposing in Big Pharma’s junk drawer. 

Analysts are penciling in $5B+ in potential peak sales, but these are the same morons who once swore Theranos would “replace the lab in your doctor’s office,” so I’ve learned to ignore them the way my dad ignores his seatbelt chime.  Still, even a blind squirrel finds an acorn eventually, and Pfizer’s too massive to miss forever… so maybe this is finally the one. But in all seriousness, I’d put more money on the Titans winning the super bowl this year than Pfizer not figuring out a way to f’ this all up.

At the time of publishing this article, Stocks.News doesn’t hold positions in companies mentioned in the article.