Pfizer Makes Supportive Investment in Akero's NASH Drug


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Shares of Akero Therapeutics are surging Thursday after the company announced that pharma giant Pfizer made a $25 million equity investment that will help support the development of its experimental pre-cirrhotic and cirrhotic nonalcoholic steatohepatitis therapeutic (NASH) drug. 

Akero’s efruxifermin is a long-acting analog of fibroblast growth factor 21 (FGF21) being assessed in two ongoing Phase IIb studies. The company also has designs on pushing into Phase III as well.

NASH is a serious progressive liver disease caused by excessive fat accumulation in the liver that induces chronic inflammation, resulting in progressive fibrosis that can lead to cirrhosis, eventual liver failure, cancer and death. Advanced fibrosis is associated with a substantially higher risk of liver-related morbidity and mortality in patients with NASH, and the disease is projected to become the leading cause of liver transplants in the United States. The disease indication has been targeted by multiple companies, including Pfizer but, as of yet, there are no approved therapies in the U.S. In May, Pfizer secured Fast Track Designation for its combination therapeutic of ervogastat and clesacostat in this indication.

The $25 million investment into Akero’s efruxifermin gives the larger pharma company another shot on goal in this indication. By 2026, the NASH market is expected to be valued at $18.3 billion and it’s only expected to become larger due to its prevalence in the United States. In fact, analysts predict that the clinical trials market in NASH will be valued at $4.1 billion by 2030. Pfizer’s Jeff Pfefferkorn, Ph.D., vice president of discovery and development in the internal medicine research unit at Pfizer, noted that efruxifermin (EFX) has emerged as a promising potential NASH therapy based on its clinical trial data.

“NASH is a priority therapeutic area for Pfizer due to the substantial global unmet medical need it represents, and we are excited to support Akero as it advances EFX towards a potential Phase III study,” Pfefferkorn said in a statement. Following the investment, Pfefferkorn is expected to join Akero’s newly formed Scientific Advisory Board.

Under terms of the equity investment with Pfizer, Akero will sell 2,525,252 shares to Pfizer at a price of $9.90 per share. Shares of Akero closed at $8.50 on Wednesday but by the time the markets opened Thursday morning were already selling at $9.40 per share. Following the transaction, Pfizer will own approximately 6.7% of Akero’s outstanding common stock. Pfizer made its investment in Akero through its Pfizer Breakthrough Growth Initiative (PBGI), which supports biotechnology companies aiming to deliver transformative therapies for diseases that are consistent with the company’s core areas of focus.

“Pfizer has deep expertise and history in addressing health challenges that affect millions of patients around the world, including cardiometabolic diseases. We are honored and excited to have their confidence, collaboration and support,” Andrew Cheng, M.D., Ph.D., president and chief executive officer of Akero said in a statement.

In addition to the $25 million equity investment from Pfizer, Akero also secured a term loan facility valued at up to $100 million from Hercules Capital, Inc. Akero has already made plans to draw $10 million. Under terms of the deal with Hercules, Akero has immediate access to another $10 million and then can draw an additional $35 million in two separate tranches upon achievement of near-term clinical and financial milestones. These funds, along with Akero’s existing cash, will provide financial support through the third quarter of 2024.

“With our existing cash on hand, we expect these two financings will extend our cash runway a full two years beyond our upcoming HARMONY readout, providing us the flexibility to optimize our capital structure to support the continued development of EFX,” Cheng added.

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