Aim for China's innovative drug power!

Novo Nordisk announced on Monday that it has reached an exclusive license agreement with UL, headquartered in Guangdong Province, China, and the weight-loss drug giant has paid for the overseas development, manufacturing and commercialization rights of UBT251, a new type of weight-loss drug produced by Chinese pharmaceutical companies (excluding Chinese Mainland, Hong Kong, Macao and Taiwan). The down payment reaches 200 million US dollars, and there is a milestone payment of up to 1.8 billion US dollars based on the commercialization progress.

As is well known, due to market doubts caused by experimental data on Novo Nordisk's next-generation weight loss drug CagriSema, coupled with the first generation GLP-1 weight loss drug entering a price war cycle, Novo Nordisk's stock price has nearly halved in less than a year, and its market value has evaporated by nearly $320 billion.

Acquiring promising new drugs is also a reasonable measure for Novo Nordisk to emerge from the shadow of CagrySema.

Public information shows that UBT251 is a weight loss drug known as a "triple target receptor agonist". In addition to the well-known GLP-1 receptor among investors, there are also GIP (glucose dependent insulinotropic polypeptide) and glucagon receptor. Compared with the currently popular GLP-1 weight loss drugs, these new drugs theoretically can achieve more significant weight loss effects.

The triple agonist Retarutide being developed by Lilly also follows this approach, with previously released clinical data showing an astonishing 24.2% weight loss in obese individuals within 48 weeks. Lilly also revealed in February this year that the Phase III data for Retarutide is expected to be released later this year.

The publicly available experimental data for UBT251 only includes phase Ib, with a total of 36 patients included. Among them, in the highest dose group of 12mg, 15.1% weight loss was achieved after 12 weeks of administration. TUL recently launched the phase II clinical trial of UBT251 in overweight or obese people in Chinese Mainland.

Horizontally compared, CagriSema's experimental data showed an average weight loss of 15.7% in patients after 68 weeks of use, and drug tolerance has also raised concerns among some analysts. Therefore, it is not difficult to understand why the investment market is excited about the potential of UBT251.

BMO Capital Markets analyst Evan Seigerman interpreted that early data from UBT251 shows its potential to compete with Lilly Retarutide. This authorization agreement may be the first step for Novo Nordisk to seek alternative mechanisms and larger plans in the competition for efficient weight loss drugs.

Of course, it's not just Novo Nordisk that has set their sights on innovative weight loss drugs in China.

Merck exclusively acquired Hansen Pharmaceuticals' oral weight loss drug HS-10535 for up to $2 billion in December last year. Lilly also signed a cooperation agreement with Lai Kai Pharmaceutical in November last year, funding and executing the US clinical trial of LAE102 (ActRIIA monoclonal antibody) for the treatment of obesity. This drug has the potential to be used in combination with GLP-1 weight loss drugs.