00:00So, Jared, it looks like we have a bidding war on our hands for MetSara.
00:04Who do you think comes out on top?
00:07Thanks a lot for having me. We definitely have a bidding war.
00:11I'm not really sure. I mean, based just on today's language,
00:15wouldn't be shocked if if we saw one more bid from Pfizer.
00:19I think they made it clear without saying anything that their latest attempt was not necessarily the final.
00:27Sometimes you see that sort of language or rhetoric when we're talking about M&A and they omitted saying that.
00:36But at the end of the day, I'm not really sure who wins this thing.
00:39There's going to be a point in which if Novo continues to up their bid, I believe Pfizer winds up walking away.
00:46Could be wrong, but we'll see.
00:48Yeah, well, we should find out soon enough.
00:49So you take a look at Novo's latest bid this week.
00:52They submitted an updated offer that values MetSara, which has no drugs on the market, by the way, at as much as $10 billion.
01:00Tell us a little bit more about what these companies are actually bidding on.
01:04How promising is MetSara that these two giants are willing to really come to blows over it?
01:11We don't really know.
01:12I mean, this is a recent IPO.
01:14This is a 2025 IPO.
01:15So the claim to fame here for MetSara is really twofold.
01:21One, that they're working on a less frequent injection, right?
01:26Like the drugs that are on the market now are used weekly.
01:30MetSara is aiming to offer a monthly.
01:33I think there's a little bit of an issue with that because you have to titrate on a weekly basis before you get to monthly.
01:41But that's the differentiation.
01:43They're hoping that in time they can separate from the pack by offering a monthly shot versus the weekly.
01:50We're going to have to see what the efficacy and the safety look like with longer term or longer dated trials.
01:57But really, there's not that much to go on here.
02:00I think Novo's angle is probably they want to augment the pipeline.
02:04Some of their pipeline products have not gone the way they wanted them to.
02:08And then Pfizer has spent a lot of money in drug development, but really never came up with a product they thought they could move forward.
02:15So in some aspects, this is their plan B.
02:18Jared, I look at, you know, the value of Novo Nordisk compared to like a Microsoft.
02:25And obviously, there's a massive delta.
02:27But I can't understand it because the Center for Disease Control says 42 percent of Americans are obese.
02:33That's like well over 100 million people.
02:35And globally, it's exponentially larger.
02:38I pay $20 a month for chat GPT and like $1,000 a month for WeGoV.
02:45Why isn't this, you know, these obesity drugs?
02:48Why aren't they way bigger than AI, which could prove to be as bad for you as social media?
02:55It certainly could.
02:56I mean, when you look at the market for obesity, right, you're looking at a massive portion of the population.
03:02And then the key thing is then the multiplier.
03:04What is the price going to be?
03:06And so the drug started out a couple of years ago, roughly $1,000 to $1,200 a month.
03:12And now they've come all the way down to around $400 to $500 a month.
03:16And then the news came out later, earlier this morning, rather, that the, you know, that CMS is looking to negotiate pricing for the Medicare population at about $150 a month.
03:27So I think the gating factor here and why it just will never be as big is that the pricing dynamic, we've already seen the price get cut in half.
03:35And it might go down substantially from here.
03:38So that's the reason why it'll never be as big.
03:40And then there are things along the lines of, you know, patent expiry and other competitive threats, including MetSara, that are probably going to increase pricing or increase the pricing debate even more.
03:52I wonder what Pfizer eventually does, because they have nothing now to take on Eli Lilly and Novo Nordisk.
03:59And you have to, I guess, have a dog in this fight if you want to be taken seriously as a drugmaker.
04:04Yeah, this is going to be the largest category, we think, in all of drugs, right?
04:13So, you know, you would venture to guess that most of the major players would want to have some sort of presence here.
04:19Pfizer has, you know, done a lot of drug development in this area.
04:23Nothing really came to fruition that they thought was competitive enough to compete with Lilly and Novo.
04:28So it's not surprising.
04:31But then again, it comes down to the, you know, the original point.
04:34How much are they willing to spend?
04:36When MetSara IPO'd, it was around two and a half billion.
04:39Now we're talking about eight or ten.
04:41There is some limitation at some point, I think, as to how much one of these companies is going to pay.
Be the first to comment