Merck & Co. has added a second GLP-1 candidate to its pipeline, paying China’s Hansoh Pharma $112 million upfront for a preclinical drug.
The Big Pharma already has efinopegdutide, a dual GLP-1/glucagon receptor co-agonist that Merck touted last year as beating Novo Nordisk's blockbuster GLP-1 drug Ozempic in a phase 2 trial in the tricky indication of nonalcoholic fatty liver disease.
Merck said it hopes Hansoh’s GLP-1 candidate HS-10535 has a wide range of cardiometabolic benefits. As well as the upfront cash, the company is eligible to pay Hansoh up to $1.9 billion in milestone payments for the exclusive global license to HS-10535—although Hansoh may co- or solely commercialize the drug in China subject to certain conditions.
“We continue to leverage science-driven business development to augment and complement our robust pipeline,” Dean Li, M.D., Ph.D., president of Merck Research Laboratories, said in the Dec. 18 release. “Through this agreement, we aim to build on our experience targeting incretin biology to evaluate HS-10535 and its potential to provide additional cardiometabolic benefits beyond weight reduction.”
At the Goldman Sachs Healthcare conference at the start of the year, Merck CEO Rob Davis explained that initially the company had not seen much potential in GLP-1s. However, the Big Pharma will continue to invest in efinopegdutide and “remain[s] open to the broader space,” he said at the time.
“I think everyone recognizes, weight management is a hard thing to get reimbursed,” he said at the January event. “But if you can show cardiovascular outcome, if you can show a diabetes outcome, which you're starting to see data for, if you can see fatty liver disease benefits through focusing on these pathways that bring weight along with them and the total metabolic syndrome, if you will, that is an area where we think there's opportunity and we are both pursuing that in our discovery areas and thinking through it from a business development perspective as well.”
Today’s agreement isn’t Hansoh’s first experience with a Big Pharma. The Chinese biotech is already a firm favorite of GSK, which licensed a pair of antibody-drug conjugates across two deals last year.
“We are pleased to announce the in-license of our oral GLP-1 by Merck, a company with established leadership in cardiometabolic diseases,” Eliza Sun, executive director of Hansoh’s board, said in today’s release. “Hansoh Pharma is becoming an emerging leader in metabolic diseases, and we see Merck’s expertise and capabilities as key to accelerating the development of this promising asset for patients worldwide.”
William Blair analysts assessed today's deal in the context of Viking Therapeutics, which last month alone saw weight loss success for its dual agonist of GLP-1 and GIP, as well as a positive MASH readout for its thyroid hormone receptor agonist.
“From our conversations with clients, Merck represents one of the most likely acquirers of Viking,” the analysts said in a Wednesday morning note. “However, we do not believe the licensing agreement with Hansoh will preclude Merck from expanding its presence in obesity through further external business development activities.”