This obesity-drug startup emerged from stealth with $290 million and plans to take on Wegovy and Zepbound 

Biopharma startup Metsera turned heads in April when it emerged from stealth, announcing $290 million in funding from prestigious backers—an all-star roster of scientists and executives—and a portfolio of drug assets all focused on what may be the most lucrative pharmaceutical opportunity ever: obesity.



Analysts have forecast the global market for obesity drugs to be worth $100 billion or more by 2030. Today, the market is split between drugmakers Novo Nordisk and Eli Lilly, whose blockbuster GLP-1 drugs for diabetes and weight loss had combined sales for 2023 in excess of $23 billion. The breakout success of the drugs Novo’s Wegovy and Lilly’s Zepbound has set off a flurry of R&D, acquisition, and licensing as Big Pharma and startups alike vie for a piece of a market that looks virtually boundless. More than 30 companies have obesity-drug candidates moving through clinical trials , including Amgen , Roche , and Boehringer Ingelheim/Zealand , and biotechs such as Viking Therapeutics and Structure Therapeutics. Several have reported promising early data, showing more and faster weight loss than the currently available drugs. 



Metsera’s CEO, Clive Meanwell, sees the competitive landscape as, essentially, a fight for third place: “Who has the best technology that could one day give you the bronze medal behind the silver and gold of Novo and Lilly? Because in this scale of market, a bronze medal is just fine, believe me.”



Going After Big Problems



In 1997, Meanwell, a former Roche executive, founded the Medicines Company, which developed the blood thinner Angiomax and the cholesterol-lowering drug Leqvio. In 2019, he sold the company to Novartis for $9.7 billion, and the next year founded the investment company Population Health Partners (PHP), where he remains chairman and managing partner. Teaming up with other pharma veterans, including former Pfizer CEO Ian Read, along with “guys from McKinsey and dealmakers,” as he calls them, his goal was to bring investors together around the “huge opportunities” to serve large populations that have been relatively neglected by the industry.



For the past couple of decades, pharma growth has been driven by high-margin, low-volume products, such as ever-more-specialized treatments for cancer and rare diseases. “I love the fact that we’ve made progress in cancer treatment,” says Meanwell, who is an oncologist by training. “But we’ve got this population [health] problem on our hands. American cardiovascular deaths are on the increase again, which is stunning.”



COVID was a wake-up call, he says: “As Warren Buffet would say, the tide went out and some of the bathers didn’t have any bathing suits on. We had a population of overweight cardiovascular-challenged people, many of whom probably suffered more as a result of COVID than we might’ve otherwise thought.”



PHP’s investments focus on what Meanwell calls “the top 10 things that drive death and destruction in health.” Hypertension, obesity, and blood diabetes top the list. Asthma and lung disease, lipids/high cholesterol, and premature birth also make the cut. “We kind of joked around that we ought to start 10 companies, one for each of the 10,” he says. 



But as COVID waned, and the remarkable results of new weight-loss drugs became ever-more apparent, Meanwell and his partners saw a win-win opportunity. “Diabetes and weight loss go together, so that knocks off two of [the top 10] at once,” says Meanwell. “And with 130 million people in the U.S. who could qualify for on-label prescriptions for Wegovy and Zepbound, you’re suddenly in the big leagues in terms of volume.” (In addition to Metsera, PHP has started a company focused on asthma, called Areteia Therapeutics , and another, Comanche , that’s working on preeclampsia.)



Initially, says Meanwell, PHP just wanted to invest in the space by partnering with large drugmakers that already had weight-loss candidates well along in the development cycle. “We went around to all the Big Pharma companies, saying, we can bring capital, we can bring teams, we can prompt you into taking a direction you may not have done lately.” (In similar deals, private equity firm Blackstone, for example, has invested in the development of specific treatments owned by Sanofi, Alnylam Pharmaceuticals, and Autolus Therapeutics.) “We were in talks with one company for over a year, but the deal came apart when they saw how the GLP-1 category was taking off,” says Meanwell. “They had woken up to the fact that their assets were more valuable than they realized.”



The experience taught them a lot about the diabetes and weight-loss-drug marketplace, though. Rather than backing an existing company, Meanwell convinced Arch Ventures, a Chicago-based biotech investor, to team up and back an entirely new venture, Metsera, to go after obesity. Quietly, they raised additional seed and Series A financing from F-Prime Capital, GV, Mubadala Capital, Newpath Partners, and SoftBank Vision Fund, pooling together a war chest to “go shopping” for companies with promising drugs or technologies, which they could cobble together to create a Wegovy killer. 



Assembling a “Lego Kit”



Metsera knew what it would need to create a hit weight-loss drug—because it had looked inside the tool kits of its competitors. “We had already pulled apart in excruciating detail what Novo and Lilly were up to,” says Meanwell. “If you look early in their pipelines, it’s all public information.” 



Although those companies started with different molecules—peptides called semaglutide and tirzepatide—both companies have been moving from single drugs that target GLP-1 receptors in the brain and pancreas to combination drugs that target one or more additional appetite-suppressing gut hormones (GIP, GCP, and amylin, among them). They are also both working toward oral formulations as well as injectable versions of the drugs. “Even though they started in different places,” Meanwell says, “what’s fascinating to me is they’re going to meet at some kind of corner on the street. So we asked the question, what would it take to join them at that street corner five years from now?”



The answer, Meanwell says, is that “you need a Lego kit of peptides you can mix and match. It’s probably not one or two winning drugs that will dominate the space.” Not only will different populations respond better to different drugs for weight loss, but also there will be demand for easier-to-use drugs for long-term maintenance that require less frequent dosing, for example.



With its acquisition of London-based startup, Zihipp, Metsera got its hands on a lot of different Lego pieces—a library of 20,000-plus gut hormone peptides. It also found a head of R&D, Stephen Bloom, one of the first scientists to publish on the role of GLP-1 in appetite, who had been Zihipp’s chairman.



Additionally, Metsera has licensed technology related to oral drugs from South Korean biotech, D&D Pharmatech. Developing oral peptide drugs has been a sticky problem for pharma companies. They have to overcome a fundamental challenge related to “bioavailability”: because the drugs are poorly absorbed orally, much higher doses are needed. Novo Nordisk’s Rybelsus, for diabetes, is currently the only FDA-approved oral GLP-1 drug, and has bioavailability of about 1%. Meanwell claims that Metsera is developing a candidate drug with bioavailability that is “10 times better than Rybelsus”—in studies in dogs and other animals. “We are going to move quickly to see if it works in humans,” he says. “We see this as a bit of a flip of the coin in our portfolio. But someone’s going to crack it.”



When they do, Meanwell believes that oral formulations of weight-loss drugs will be approved for over-the-counter sales “lickety-split.” Because obesity is a self-diagnosable condition and the drugs have broadly proven to be safe, he says, “the FDA isn’t going to want to regulate [them] too much. So I see that being another big wave, where we’ll have more and more [people paying] out-of-pocket for these products.”



Metsera’s model, Meanwell points out, is very similar to a venture announced last month , in which four life science investors—Bain Capital Life Sciences, RTW Investments, Atlas Venture, and Lyra Capital—put $400 million into a new biotech startup, currently referred to as “Hercules CM NewCo,” that has licensed a portfolio of potential weight-loss drugs from Chinese company Jiangsu Hengrui Pharmaceutical.



Metsera doesn’t disclose an official head count, but Meanwell has repeatedly said, “It’s amazing what you can do with 70 people.” Reflecting its cobbled-together origins, the company has a global presence, with a London group working on peptide design, people in New York and New Jersey, along with its licensing partners in South Korea. “Everybody around the world is doing interesting things in this space,” he says.



And although the company is now out of stealth, it’s not exactly transparent about its clinical pipeline. The company confirms reporting from Biopharma Dive that it has Phase 1 trials underway for a GLP-1 drug and a second unidentified candidate, with more on the way. But the company has not posted either trial on Clinicaltrials.gov, which is a common but not mandatory step. A rep for the company says it will only post data “when they have some meaningful results.” 



None of the 60-plus companies with obesity drugs in development are waiting for it to catch up, though. And, despite its funding and pedigree, Metsera could find itself out of the medals altogether.