Eli Lilly and Co said on Friday it will acquire Versanis, a privately held biotech company developing a novel obesity drug, for potentially up to $1.93 billion, as it seeks to expand its presence in the lucrative weight-loss market.
The deal gives Eli Lilly access to Versanis’ lead candidate, VS-01, which is being tested in combination with Novo Nordisk’s blockbuster obesity drug semaglutide in a mid-stage trial. Semaglutide, sold under the brand name Wegovy, was approved by the U.S. Food and Drug Administration in June for chronic weight management.
Obesity is a major risk factor for various chronic diseases, such as diabetes, cardiovascular disease and cancer, and affects more than 650 million adults worldwide. Analysts expect the market for obesity drugs to reach up to $100 billion within a decade, with early movers such as Eli Lilly and Novo Nordisk capturing a large share of the demand.
Versanis shareholders could receive $1.93 billion, which includes an undisclosed upfront payment and additional payments upon achievement of certain development and sales milestones, Eli Lilly said in a statement.
“We believe VS-01 has the potential to be a best-in-class treatment option for people living with obesity,” said Patrik Jonsson, president of Lilly Bio-Medicines. “This acquisition is another example of our commitment to delivering breakthrough medicines that can transform the lives of people with serious chronic diseases.”
The deal is expected to close in the fourth quarter of 2021, subject to customary closing conditions and regulatory approvals. Eli Lilly said it does not expect the deal to have a material impact on its 2021 earnings guidance.