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(Reuters) -Denmark’s Novo Nordisk (NYSE:NVO) is partnering with biotech company Deep Apple (NASDAQ:AAPL) Therapeutics in a deal worth up to $812 million to develop drugs for cardiometabolic diseases, including obesity, the California-based company said on Wednesday.
Deep Apple discovers drug candidates using its AI-based platform that screens virtual libraries of billions of compounds to cut drug discovery time, the company said.
Under the deal, Novo will receive exclusive global rights to develop and commercialize so-called non-incretin oral therapies, which belong to a different class of medicines than its popular weight-loss and diabetes drugs Wegovy and Ozempic.
WHY IT’S IMPORTANT
Novo has been trying to strengthen its foothold in the potential $150 billion weight-loss drug market through the development of next-generation treatments as well as acquisitions and partnerships.
In March, the company signed two licensing deals and gained access to experimental obesity drugs from Lexicon Pharmaceuticals (NASDAQ:LXRX) and China-based United Laboratories International.
CONTEXT
Novo in May ousted CEO Lars Fruergaard Jorgensen over concerns the Danish company - a world leader in the lucrative weight-loss drug market - was losing its first-mover advantage.
The company’s shares have plunged since hitting a record high in June last year as competition, particularly from U.S. rival Eli Lilly (NYSE:LLY), eats into its market share, while Novo’s pipeline of new drugs has failed to impress investors.
BY THE NUMBERS
As part of the license agreement with Novo, Deep Apple will be eligible to receive up to $812 million in payments, as well as potential royalties on sales of any products that emerge from their collaboration.