Pfizer chisels off stake in Akero with $25M equity investment to support NASH dreams

Pfizer has dropped off a little bit of cash in the form of an equity investment for Akero Therapeutics, adding $25 million for the biotech to continue work on two midphase trials in the difficult liver disease nonalcoholic steatohepatitis (NASH).

The funds will add to a separate financing Akero tapped Thursday, in the form of a term loan facility from Hercules Capital Inc. that gives the biotech access to $100 million.

After dropping the metaphorical check off at the bank, Akero will use the money for two ongoing phase 2b trials for efruxifermin, or EFX, in pre-cirrhotic (called HARMONY) and cirrhotic (called SYMMETRY) NASH. Additional funds will go toward manufacturing drug product for future phase 3 trials and getting that late-stage study off the ground.

The term loan facility will help fund the company's operations until the third quarter of 2024. This gives the California biotech an extra year in terms of cash guidance and provides a runway for two years beyond the anticipated data readout for the HARMONY trial, which is expected in the third quarter.

“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,” said Andrew Cheng, M.D., Ph.D., president and CEO of Akero.

The Pfizer investment comes from the Big Pharma’s Breakthrough Growth Initiative. Akero will sell more than 2.5 million shares to Pfizer at $9.90 apiece in an offering expected to close June 17. This will give Pfizer a 6.7% ownership stake in Akero.

As a result of the transaction, Akero also plans to strike up a scientific advisory board, with Pfizer taking one of the seats. The likely seat filler will be Jeff Pfefferkorn, Ph.D., vice president of Pfizer's discovery and development, internal medicine research unit.

“EFX has quickly emerged as a promising potential NASH therapy, with a strong record of clinical trial data,” Pfefferkorn said.

He called NASH a priority area for Pfizer, but many Big Pharmas feel the same way—even though the indication has left its mark on clinical programs big and small. Akero’s effort has been a rare glimmer of hope among a raft of failures. The small biotech found that EFX spurred an improvement in fibrosis among patients in a phase 2a trial back in 2020.

Bristol Myers Squibb, Genfit, Enanta and Metacrine, meanwhile, have all notched failures over the past year.