Amid declining demand for COVID treatments and a substantial drop in its share price, Pfizer is setting its sights on the lucrative weight-loss medicine market. Investors are eagerly awaiting results from Pfizer's phase two trial on Danuglipron, a twice-daily tablet designed for obese non-diabetic patients, with expectations that it will rival Eli Lilly's once-daily pill.
Pfizer's move into the weight loss medicine market comes after the success of Novo Nordisk's Wegovy and Ozempic and Eli Lilly's Mounjaro, which played a pivotal role in kickstarting the weight loss medicine market last year. The market demand for obesity and diabetes drugs has been on the rise, and Pfizer aims to capture a significant share to recover from its COVID-related setbacks.
Despite a 40% share price decline this year and the cancellation of its experimental once-daily pill due to elevated liver enzymes, Pfizer remains optimistic about the potential of danuglipron. Analysts suggest that the competitiveness of Pfizer against Eli Lilly and Novo Nordisk will hinge on the upcoming trial results, expected to be revealed by year-end and early next year.
Pfizer's CEO, Albert Bourla, envisions a substantial market opportunity, predicting that the GLP-1 market could reach $90 billion, with Pfizer aiming to secure $10 billion of that market share through its oral therapy. However, the cancellation of the once-daily pill has tempered investor expectations, given the convenience of a once-a-day treatment.
The trial outcomes for Novo Nordisk and Eli Lilly have already impacted their share prices positively this year. Analyst Louise Chen notes that positive results for Pfizer could help investors look beyond the challenges posed by the ongoing COVID situation.
The weight-loss medicine market is attractive not only to Pfizer but also to Eli Lilly and Novo Nordisk. Oral medications offer easier manufacturing processes and greater convenience for both doctors and patients, addressing potential supply issues associated with injectable medications.
Analysts emphasize that Pfizer's twice-daily danuglipron must demonstrate effectiveness comparable to Eli Lilly's once-a-day drug, implying a weight drop of 14%–15%. Eli Lilly's phase two trial showed a 14.7% weight reduction in individuals taking its pill once a day.
Pfizer's ongoing phase two trial aims to give a full picture of Danugliprons effects over a long period of time, giving information about how it might help obese people who are not diabetic lose weight. Investors are particularly interested in the efficacy and safety of a once-daily version, considering doctors' preference for once-daily medications and potential reductions in gastrointestinal side effects.
While challenges remain, Pfizer remains optimistic about a late-stage trial for the once-a-day version, expressing confidence that it is "within our reach" by 2024. As Pfizer strives to secure a position in the weight loss medicine market, the industry awaits crucial trial results that could shape the company's trajectory beyond the challenges posed by the COVID overhang.
