Novo Nordisk Closes $200M Deal with Chinese Biotech to Boost Obesity Drug Pipeline

Novo Nordisk is expanding its portfolio of obesity drugs, announcing Monday, March 24th, that it has entered into a deal with China’s United Laboratories International Holdings to license an experimental “triple agonist” weight-loss drug. The deal will involve an initial payment of $200 million, and could directly compete with Eli Lilly’s retatrutide.

Under the terms of the agreement, Novo Nordisk will have rights to commercialize the drug outside of China and neighboring marketing territories. The Danish company could also pay up to an additional $1.8 billion if it reaches certain development milestones for the drug, called UBT251.

Novo Nordisk will also pay royalties on sales in its marketing territories

Having brought the GLP-1 drug Wegovy to market five years before Eli Lilly and its drug Zepbound, Novo Nordisk had a big head start in the obesity space. But Lilly is catching up quickly, showing in trials that Zepbound helps people lose more weight than Wegovy and closing the gap in sales to $4.9 billion for Zepbound versus $8.4 billion for Wegovy in 2024.

Both Novo Nordisk and Lilly have struggled to meet demand for their obesity drugs, forcing them to invest billions of dollars in increasing production capacity. Now that that issue is largely resolved, Novo Nordisk is turning its attention to competition, as it faces stiff challenges not only from Lilly but also from other potential rivals such as Amgen, Pfizer, Zealand and Viking Therapeutics.

Novo Nordisk pioneered the use of drugs that stimulate a gut hormone called GLP-1 to help obese people lose weight. Lilly showed that by targeting a second hormone called GIP, Zepbound could improve the effectiveness of GLP-1. Drug companies are now experimenting with other related pathways involving glucagon and amylin. Novo Nordisk’s initial attempt in this area, combining GLP-1 and amylin, has so far performed less well than expected, however.

Lilly is also leading the way in triple-agonists with an experimental drug called retatrutide, with Phase 3 results likely next year. Last year, Novo Nordisk advanced a triple agonist into Phase 1 trials, but with today’s deal, it will have a drug that has already completed a Phase 1 dosing study.

“The addition of a candidate that targets glucagon, as well as GLP-1 and GIP, will add an important option to our clinical pipeline as we seek to develop a broad, differentiated portfolio of treatments that meet the diverse needs of people living with these conditions,” Martin Holst Lange, executive vice president of development at Novo Nordisk, said in a statement.

Novo Nordisk said United’s drug has a similar side effect profile to Wegovy, Zepbound and other drugs in the same class. The drug helped people who completed the study lose 15.1% of their body weight in 12 weeks, compared with a 1.5% gain in the placebo group.

The new triple agonist will add to an already robust pipeline. The portfolio includes the GLP-1/amylin drug CagriSema, for which Novo Nordisk still has high hopes, a version of its GLP-1 diabetes pill Rybelsus for obesity, and various combinations of GLP-1, GIP and amylin.

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