Novo Nordisk inked an obesity deal worth up to $2.2 billion on Wednesday, sending shares of small biotech company Septerna into the stratosphere.
Under the deal's terms, Novo and Septerna will collaborate to discover up to four new treatments for obesity. Septerna will be eligible to receive up to $2.2 billion, including north of $200 million in up-front and near-term payments.
Septerna is an expert in G protein-coupled receptors, or GPCR. GPCRs are cell membranes that help regulate physiological processes in nearly every organ system in the body. They will combine the GPCR-directed therapies with other common targets in weight loss including the GLP-1, GIP and glucagon receptors.
"Novo Nordisk has a long-standing track record of bringing transformative therapies to market, particularly in the field of metabolic disease, which makes them the ideal partner to advance a suite of programs targeting critical GPCRs for treating obesity, type 2 diabetes and other related conditions," Septerna Chief Executive Jeffrey Finer said in a written statement.
Septerna stock skyrocketed 51%, closing at 10.16, while shares of Novo Nordisk — which rose in early action — shed 1.6%, ending the regular session at rose early but closed down 1.6% at 64.39.
Novo Nordisk's Growing Obesity Focus
The deal builds onto Novo Nordisk's "rich history" in treating obesity and diabetes, Novo Chief Scientific Officer Marcus Schindler said in a statement.
In recent weeks, Novo signed a deal with Hims & Hers Health to sell Novo's weight-loss drug, Wegovy, on the telehealth company's platform.
Novo also asked the Food and Drug Administration to approve its oral semaglutide. Semaglutide is the chemical backbone behind Novo's Wegovy and diabetes treatment Ozempic. The move helps Novo leapfrog Eli Lilly, which was expected to be the first to ask the FDA to approve a weight-loss pill.
In the deal with Septerna, Novo Nordisk will fund all the research and development costs. Once the companies begin preparing for human testing, Novo will take over all global development and commercialization activities.
Septerna will be eligible to receive tiered royalties on net sales of products coming out of the deal. The small biotech company will also be able to opt in to worldwide profit sharing for one of the drugs, in lieu of future milestones and royalties for that product.
Novo Shares Are Under Pressure
Despite the bevy of good news recently for Novo Nordisk' obesity-tied efforts — CVS' Caremark also selected Wegovy as its preferred weight-loss drug — shares are under pressure.
Novo stock is down 24% in 2025, as of Tuesday's close. Shares are trading under their 50-day line and have a poor IBD Digital Relative Strength Rating of 9. This means Novo shares underperformed 91% of all stocks over the last 12 months.
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