The U.K.-based drugmaker
AstraZeneca
is jumping into the increasingly crowded race to bring an effective weight-loss pill to market, and it says its late start won’t be a major setback.
AstraZeneca
(ticker: AZN) last week announced a licensing deal with a Chinese biotech for a weight-loss pill still in early-stage trials. Investors have swooned over the opportunity for record-obliterating sales from the new class of weight loss drugs from
Novo Nordisk
(ticker: NVO) and
Eli Lilly
(LLY), making both the companies among the most valuable in healthcare.
Yet while those companies, and a handful of others, already have a substantial lead over AstraZeneca in the weight loss market, AstraZeneca CEO Pascal Soriot says there’s still plenty of room for their pill.
Speaking at a press event at the company’s New York offices on Friday, Soriot said he sees opportunity targeting overweight adults seeking a bit of weight loss, but not the dramatic weight cuts offered by the current injectables.
“The huge market is actually not in obesity, it’s in weight management,” Soirot said. “So one of the key pieces for us is to have an agent that will target those people and help them lose a bit of weight.”
The AstraZeneca announcement came the day after Lilly received Food and Drug Administration approval of its weight loss injection Zepbound, and just ahead of anticipated Phase 2b data on
Pfizer’s
(PFE) weight loss pill danuglipron. Lilly is testing its weight loss pill, orforglipron, in a Phase 3 trial, and Novo already has positive Phase 3 data on a high-dose version of its weight loss pill Rybelsus, and plans to ask for FDA approval this year.
But even if AstraZeneca is late to the party, excitement about the potential of weight-loss treatments has never been higher. Novo on Saturday announced full data on a large study of its weight loss injection Wegovy, which showed that the drug significantly reduced the rates of heart attacks and strokes. The study helps establish broader health benefit for the drug class that will be essential for securing widespread insurer coverage of the medicines.
AstraZeneca has been one of the rare global biopharma companies to stay in Wall Street analysts’ favor this year, in addition to Lilly and Novo. The company’s American depositary receipt is down 6.2% on the year, but 25 of the 29 analysts who cover the stock tracked by
FactSet
rate it Buy or Overweight. Much of the analyst enthusiasm is focused on the company’s cancer drugs, including the breast cancer treatment Enhertu and an experimental cancer drug called datopotamab deruxtecan.
The newly-licensed weight pill, known as ECC5004, will be tested as a treatment for obesity and related conditions in combination with other drugs already in AstraZeneca’s pipeline, according to Soriot. But Soriot emphasized the opportunity in weight management for a less-effective, cheaper, easier-to-tolerate pill for patients who are overweight, but not obese.
“Everybody focuses on obesity, and everybody says 25%,” Soirot says, referring to the percent body weight loss achieved by a third of patients on Lilly’s Zepbound in one study. “But if your ideal weight is 75 kilos, and you are at 85 [kilos], you need to lose weight, especially as you get older. But you don’t need 25% [weight loss].”
AstraZeneca is far from the only company targeting this market with a pill, but Soriot said his company’s drug has advantages. He noted that
Pfizer’s
pill under development currently must be taken twice a day, which could be a drawback. (Pfizer says it is working on a once-daily version.) He said that Novo’s semaglutide must be given at higher doses, because of its chemical makeup, which makes it more expensive to produce.
“One of the attractions we have for this oral agent is a low cost of goods that will democratize the use of this product,” he says. The cost of goods is lower for ECC5004, he said, because the drug’s chemistry is relatively simple.
Even with the expected competition, Soriot said that the market was big enough for lots of players. “There’s room for several products,” he said. “We’re not saying we have a product we launch tomorrow. We are at the beginning of a journey.”
AstraZeneca’s CFO, Aradhana Sarin, said that the company planned to test the drug’s cardiovascular benefits over the long term, in addition to running weight loss trials. “It’s not just weight loss, its actually the cardiovascular outcomes that we’re looking at,” Sarin said.
AstraZeneca paid $185 million up front to the Shanghai-based Eccogene for global rights to develop and commercialize ECC5004 outside of China, and shared rights inside of China. Eccogene is eligible for additional payments worth up to $1.8 billion. ECC5004 is currently being tested in an ongoing Phase 1 trial in the U.S.
Write to Josh Nathan-Kazis at [email protected]
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