In a significant move to bolster its position in the rapidly growing obesity treatment market, Danish pharmaceutical giant Novo Nordisk (NYSE:NVO) has entered into a licensing agreement with Lexicon Pharmaceuticals (NASDAQ:LXRX) for its experimental obesity drug, LX9851.
The deal, announced on Friday, could be worth up to $1 billion for Lexicon.
Under the terms of the agreement, Novo Nordisk will acquire worldwide rights to develop, manufacture, and commercialize LX9851 for all indications.
Lexicon Pharmaceuticals, based in the United States, will be eligible to receive upfront payments along with potential development, regulatory, and sales milestone payments totaling $1 billion.
The news sent Lexicon's shares skyrocketing nearly 90% to 66 cents in pre-market trading, reflecting investor enthusiasm for the deal.
This marks the second significant acquisition for Novo Nordisk this week, as the company intensifies its efforts to capture a share of the obesity market, projected to reach $150 billion.
On Monday, Novo secured global rights to a weight-loss drug candidate from China-based United Laboratories International in a deal valued at up to $2 billion.
Novo Nordisk's aggressive push into next-generation obesity treatments through strategic partnerships and acquisitions underscores the growing importance of this therapeutic area.