European pharmaceutical giant Novo Nordisk (NVO) has struck a licensing deal with U.S. biotech firm Septerna (SEPN) to develop new obesity treatments.
The deal, which could be worth up to $2.2 billion U.S. for Septerna, would see the two companies create medicines for obesity, Type 2 diabetes, and other metabolic illnesses.
Novo Nordisk already makes the popular Wegovy weight-loss medication that had global sales of more than $8 billion U.S. in 2024.
However, Novo Nordisk is looking to forge partnerships as it seeks a greater slice of the obesity market that analysts say could be worth $150 billion U.S. in coming years.
Novo Nordisk is also looking to create next-generation drugs as investors grow concerned that the company’s weight loss medication is losing ground to rival Eli Lilly’s (LLY) Zepbound drug.
Both Novo Nordisk and Eli Lilly are racing to bring a weight loss pill to market that will be easier for consumers to take than the current injections and is expected to further boost sales.
The partnership with Septerna includes more than $200 million U.S. in upfront and near-term payments.
California-based Septerna is already working on some protein-based weight loss and weight management medications.
Novo Nordisk and Septerna plan to begin four weight loss development programs in coming months.
Earlier in May, U.S. regulators accepted Novo Nordisk's submission for a pill version of Wegovy, which, if approved, would become the first oral treatment for obesity.
The stock of Novo Nordisk has declined 25% this year to trade at $65.40 U.S. per share.
