Eli Lilly and Company, a prominent pharmaceutical company headquartered in Alcobendas, Madrid, Spain, has announced its acquisition of Versanis, a privately held obesity drug maker, for a staggering sum of up to $1.93 billion. This strategic move aims to enhance Eli Lilly’s weight loss treatment portfolio.
The transaction will see Eli Lilly make cash payments to Versanis shareholders, including an upfront payment, and potential additional payments based on the achievement of specific development and sales milestones.
Versanis, based in Oakland, California, was established in 2021 by biotech investment firm Aditum Bio. The company is currently focused on developing an experimental obesity drug, which also shows promise for addressing other medical conditions.
Following the news of the acquisition, Eli Lilly’s stock price experienced a 3% increase on Friday.
This deal is part of Eli Lilly’s ongoing efforts to capitalize on the booming weight loss industry. The sector has witnessed significant growth since the success of Novo Nordisk’s blockbuster injections, Wegovy and Ozempic, in the past year.
With approximately 40% of U.S. adults classified as obese, industry analysts project that the global weight loss drug market could reach a value of $100 billion by 2030.
Versanis’ drug, known as bimagrumab, operates by binding directly to specific cells in the body to reduce fat mass. The company is currently conducting a phase two trial for bimagrumab involving overweight or obese adults. Additionally, another trial is comparing the efficacy of bimagrumab with Novo Nordisk’s Wegovy and Ozempic.
Unlike Novo Nordisk’s drugs and similar treatments from Eli Lilly, which mimic gut hormones called incretins to suppress appetite, bimagrumab works differently. However, Versanis believes that combining bimagrumab with incretin-based therapies could lead to improved outcomes for individuals dealing with obesity and related cardiometabolic conditions such as diabetes, kidney disease, and heart disorders.
In addition to the Versanis acquisition, Eli Lilly is actively working on several other obesity treatments. Their once-weekly experimental injection, retatrutide, has demonstrated promising results, helping overweight or obese patients lose up to 24% of their weight after 48 weeks—outperforming other available obesity drugs. Furthermore, Eli Lilly’s experimental obesity pill, orforglipron, has shown the ability to help patients lose up to 14.7% of their body weight after 36 weeks. The company is also seeking approval for its Type 2 diabetes treatment, Mounjaro, as a potential treatment for obesity.
A correction to the previous version: Versanis’ drug, bimagrumab, functions by directly binding to specific cells in the body to reduce fat mass. The earlier version misspelled the drug’s name.
This acquisition marks an exciting development for Eli Lilly as it endeavors to expand its weight loss treatment offerings and make a significant impact in the battle against obesity and related conditions.
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