[Kim Jin Soo, Edaily Reporter] D&D Pharmatech shares fell sharply after it was confirmed that development had been halted on an obesity drug candidate built using the company’s technology. Coming on the heels of questions about Peptron’s technology evaluation agreement with Eli Lilly and Co., the news has shaken expectations for obesity treatments based on Korean biotech platforms.

Dongwoon Anatech shares rose on news that the company had filed a clinical trial application for its saliva-based glucose meter and would soon release trial results.

D&D Pharmatech Falls 18%

D&D Pharmatech closed at 53,100 won on Aug. 5, down 18.06% from the previous session, according to MP Doctor, the KG Zeroin platform formerly known as Marketpoint. The decline is attributed to news that Metsera’s obesity pipeline had been scaled back.

Pfizer Inc. stated on Aug. 4 in its second-quarter earnings materials that it had discontinued development of MET-224o, a candidate based on D&D Pharmatech’s ORALINK oral peptide platform, according to industry officials.

D&D Pharmatech licensed six oral obesity drug candidates to Metsera in 2023 for $803.5 million, and Metsera was later acquired by Pfizer. MET-224o is a glucagon-like peptide-1 (GLP-1) receptor agonist that utilizes the ORALINK platform. Pfizer took over direct development of the candidate when it acquired Metsera but halted the program, citing a change in strategy, among other reasons. Pfizer stated that it would continue to pursue GLP-1 candidates through both oral peptides and small molecules.

As the stock price fell, D&D Pharmatech moved to contain the damage, stating that the discontinuation does not indicate a technical problem with ORALINK and that the partnership remains strong.

Citing confidentiality obligations that limit what it can disclose, the company said Pfizer—a latecomer to the obesity market—is focusing on products that differentiate themselves from approved drugs. Specifically in the area of oral peptides, it is prioritizing the development of multi-agonists that deliver greater weight loss than single GLP-1 agonists.

“Two oral products from the joint development program entered clinical trials, and the strategy of advancing only one of them after early trials had been publicly announced prior to the acquisition,” a D&D Pharmatech official said. “The inclusion of one of those products in this round of discontinuations is entirely foreseeable as an extension of the existing development strategy.” The two pipeline candidates the company referred to are MET-224o and MET-097o.

“Given that Pfizer has stated it will continue developing peptide-based oral GLP-1s, this represents a strategic shift toward more competitive products, not an issue with ORALINK,” the official said. “If it had been a technical problem, they would not be developing follow-on products based on the same technology.”

The official added: “We have been actively cooperating with the new partner’s development strategy since the change in ownership, and collaboration at the discovery stage is very active. We are also broadening the scope of that collaboration as a partner in next-generation obesity treatments.”

Analysts said the market reacted so sharply due to the earlier controversy surrounding Peptron’s technology evaluation agreement with Eli Lilly. Peptron CEO Choi Ho-il stated at a biotech forum in July that the company was developing a different peptide formulation with Lilly and that tirzepatide was not included.

Tirzepatide is the active ingredient in the obesity drug Mounjaro. The market had expected Peptron’s technology to result in a once-monthly formulation of Mounjaro, but Choi’s remarks raised questions about the platform evaluation deal with Lilly, which is based on a material transfer agreement.

“Obesity drugs are the hottest topic right now, so the market is reacting strongly to every piece of news,” said an industry official. “Development updates need to be watched closely.”

Dongwoon Anatech: D-SaLife Development Accelerates, Boosting Shares

Dongwoon Anatech closed at 32,000 won on Aug. 5, up 15.52% from the previous session. The gain reflects expectations tied to the accelerated development of D-SaLife, its saliva-based glucose meter.

The company said it submitted an application in late July to the Ministry of Food and Drug Safety seeking approval for a clinical trial plan for D-SaLife. Because the device is classified as both an in vitro diagnostic medical device and a digital medical device, Dongwoon Anatech plans to conduct two separate trials.

Results from an ongoing trial at the UCLA School of Dentistry are also expected in September. That study examines how accurately D-SaLife detects glucose in saliva and whether the device’s saliva glucose readings differ from blood glucose levels.

D-SaLife measures blood sugar by detecting glucose in saliva, eliminating the need for a blood draw. It is expected to be a game-changer if it reaches the market.

“The pilot trial results for D-SaLife will be released at the first international symposium of the Asian Salivary Gland Research Society (ASGRS) in September,” said a Dongwoon Anatech official. “The recent filing of the clinical trial plan with the Ministry of Food and Drug Safety and other development progress appear to be reflected in the stock price.”