Novo Nordisk secures US $1B Lexicon obesity drug deal

DENMARK – Novo Nordisk has signed a deal worth up to US $1 billion with Lexicon Pharmaceuticals for the exclusive global rights to LX9851, an experimental oral treatment for obesity and related metabolic disorders.

Under the agreement, Lexicon will complete specific preclinical activities before Novo Nordisk takes over development, manufacturing, and commercialization.

Lexicon will receive US $75 million in upfront and near-term milestone payments, with the potential to earn up to US $1 billion, including development, regulatory, and sales-based milestones.

Following the announcement, Lexicon’s stock surged by 85%, rising from US $0.35 to US $0.65. Meanwhile, Novo Nordisk’s stock remained stable.

LX9851 targets Acyl-CoA Synthetase 5 (ACSL5), an enzyme linked to fat metabolism and energy balance.

At Obesity Week in Texas, US, in November 2024, preclinical data showed that combining LX9851 with Novo Nordisk’s flagship drug semaglutide—marketed as Ozempic for type 2 diabetes and Wegovy for obesity—resulted in more significant weight loss, reduced food intake, and fat mass compared to semaglutide alone.

Additionally, LX9851 may help prevent weight regain after stopping semaglutide treatment.

Novo Nordisk’s senior vice president for diabetes, obesity, and MASH therapeutic areas, Jacob Sten Petersen, stated, “We are pleased to enter this agreement with Lexicon as it will allow us to explore a novel biology and potential treatment paradigm further.”

The deal highlights Novo Nordisk’s strategy to strengthen its position in the obesity treatment market, projected to reach US $206.5 billion by 2031, according to GlobalData’s Pharma Intelligence Center.

While Novo Nordisk has dominated the space with its GLP-1RA Wegovy, competition from Eli Lilly’s Zepbound (tirzepatide) is rising due to Zepbound’s slightly better efficacy.

According to GlobalData, Zepbound is forecasted to generate US $28.2 billion by 2031, while Wegovy is expected to make US $26 billion.

The growing demand for weight-loss treatments, particularly oral candidates that are easier to administer, is driving market growth.

In January 2025, UK-based Verdiva Bio launched with US $410 million, focusing on next-generation oral and injectable therapies.

Novo Nordisk has been expanding its obesity and metabolic disease pipeline aggressively. The Lexicon agreement follows its US $2 billion acquisition of UBT251, a “triple-G” injectable obesity drug from China-based United Laboratories earlier last week.

The drug demonstrated positive results in a Phase Ib trial in China, where 36 patients receiving a subcutaneous 6mg dose over 12 weeks reported an average weight loss of 15.1%.

Additionally, in January 2025, Novo Nordisk invested US $50 million upfront in Variant Bio to explore genetic targets for obesity and metabolic diseases.

The company also signed a deal in March with AI-driven protein design company Gensaic to develop tissue-targeted therapies for cardiometabolic diseases.