JPMorgan remains cautious on Pfizer’s danuglipron with Phase 3 decision upcoming

JPMorgan notes that Pfizer’s (PFE) decision on a potential move into Phase 3 for danuglipron, an oral GLP-1 drug, is expected in the coming weeks and sees a “fairly high likelihood” that the company moves into Phase 3 trials. While the firm remains cautious on the asset longer-term given the product’s high adverse event and dropout rates in Phase 2, the firm anticipates shares to be up “modestly,” or about 2%-4% in a scenario where danuglipron does move into Phase 3 testing. The firm, which believes the Street will need to see Phase 3 data, likely in 2027, before assigning meaningful value to the asset, keeps a Neutral rating on Pfizer shares, which it views as inexpensive but balanced against modest top-line erosion over the next five years.