Novo Nordisk (NYSE: NVO) has entered into a collaboration and licensing agreement with U.S.-based biotech firm Septerna (NASDAQ: SEPN) to co-develop oral small molecule therapies targeting obesity, type 2 diabetes, and other cardio-metabolic conditions. The deal, announced Wednesday, could be worth up to $2.2 billion for Septerna.
As part of the agreement, Septerna will receive over $200 million in upfront and near-term milestone payments. The partnership underscores Novo Nordisk’s strategic push to expand its pipeline in the rapidly growing obesity market, estimated to reach $150 billion in value.
Novo, the manufacturer behind the blockbuster weight-loss injection Wegovy, is intensifying its R&D efforts as competition stiffens—particularly from Eli Lilly (NYSE: LLY), whose obesity treatment Zepbound has outpaced Wegovy in U.S. prescription volumes since mid-March.
“Novo Nordisk has a strong legacy of innovation in the fields of obesity and diabetes,” said Marcus Schindler, Chief Scientific Officer at the Danish pharmaceutical company. “We are leveraging that leadership to build a broad pipeline that spans diverse modalities, including peptides and small molecules.”
Septerna, based in California, is focused on developing treatments that target G-protein-coupled receptors (GPCRs), a crucial class of cell surface proteins that regulate key biological functions such as metabolism, immune response, and cellular signaling. The collaboration will initially launch four programs centered around small molecule therapies directed at select GPCR targets.
This deal marks the second major pharma partnership in the obesity space in recent months. In March, Roche committed up to $5.3 billion in a co-development deal with Zealand Pharma for an experimental obesity treatment.
In a separate development, Novo Nordisk recently submitted an application to U.S. regulators for an oral formulation of Wegovy. If approved, it would be the first pill-based therapy from the GLP-1 class, which includes both Wegovy and Zepbound.
According to LSEG data, investment firms Goldman Sachs and Third Rock Ventures own 3.3% and 23.7% of Septerna, respectively.