Novo Nordisk Expands Obesity Pipeline with $2.4B Septerna Deal

Novo Nordisk, a leader in the rapidly growing obesity drug market, has struck a significant deal with biotechnology startup Septerna to develop new oral obesity medications. The collaboration, announced on Wednesday, involves an upfront payment of over $200 million and potential milestone payments of up to $2.2 billion, signaling Novo's commitment to maintaining its dominance in the field.

Strategic Partnership Targets Novel Oral Therapies

The partnership between Novo Nordisk and Septerna will focus on developing small molecule drugs for obesity, type II diabetes, and other cardiometabolic diseases. The companies will initially prioritize four experimental programs aimed at G-protein coupled receptors (GPCRs), including GLP-1, GIP, and glucagon receptors.

Septerna's proprietary technology for targeting GPCRs is a key factor in this collaboration. The biotech has discovered a unique binding pocket with 80% to 90% sequence similarity across GLP-1, GIP, and glucagon receptors, potentially allowing for the development of single molecules that can activate multiple incretin receptors simultaneously.

Marcus Schindler, Novo Nordisk's Chief Scientific Officer, expressed enthusiasm about the partnership, stating, "Septerna has demonstrated strong capabilities in GPCR drug discovery, and we are excited about the opportunity to develop oral small molecule medicines directed at multiple targets."

Race for Oral Obesity Medications Intensifies

This deal comes as Novo Nordisk faces increasing competition in the oral weight loss drug space. Rival Eli Lilly recently reported promising Phase III trial results for its oral GLP-1 agonist, orforglipron, demonstrating "injectable-like efficacy" in treating type 2 diabetes. Lilly is now advancing towards Phase III obesity readouts, with potential regulatory submissions for weight loss treatment expected this year.

Novo Nordisk's own oral obesity drug candidate, amycretin, achieved 13% weight loss in a Phase I trial last fall. The company has also recently submitted an oral version of semaglutide—the active ingredient in its blockbuster injectable medicine Wegovy—for U.S. approval.

Collaborative Approach and Future Prospects

Under the terms of the agreement, Novo Nordisk and Septerna will collaborate on research and development from program discovery stages through to candidate selection. Novo will then take over development for preclinical testing and subsequent stages. Septerna retains the right to opt into a profit share for one of the product candidates, foregoing milestone and royalty payments for that specific drug.

Jeffrey Finer, CEO of Septerna, highlighted the potential impact of this collaboration, saying, "This collaboration provides a significant opportunity to create multiple potentially groundbreaking oral medicines, while also providing Septerna with the operational flexibility and resources to advance our diverse portfolio of other GPCR-targeted programmes."

As the obesity drug market is projected to exceed $100 billion in annual sales by the next decade, this partnership represents a strategic move by Novo Nordisk to solidify its position and expand its pipeline of innovative treatments. The deal is set to close in the second quarter of 2025, marking a significant milestone in the ongoing race to develop more convenient and effective obesity medications.