Lilly bulks up in obesity with $1.93bn Versanis buy

Already developing a trio of incretin drugs for obesity, Eli Lilly has its sights set on a candidate with a different mechanism of action that it hopes to acquire via a $1.93 billion takeover of US biotech Versanis Bio.

Versanis’ main asset is bimagrumab, a monoclonal antibody that binds to the activin type II receptor on skeletal muscle and was originally developed by Novartis for muscle-wasting diseases, but was offloaded to Versanis in 2021.

New York-based Versanis saw potential of the drug in helping patients simultaneously reduce fat and build muscle, recognising that loss of muscle can occur with current therapies for weight loss and tends to get worse as patients age, and picked up rights to the drug for $70 million.

Versanis has already taken bimagrumab into a phase 2b study called BELIEVE that is testing the drug alone and in combination with Novo Nordisk’s GLP-1 agonist semaglutide in overweight and obese adults.

Lilly’s move gives it the opportunity to sidestep semaglutide – which is already approved as a weekly injection to treat obesity as Wegovy – and investigate the use of bimagrumab in combination with its own incretin-based therapies.

Those are headed by injectable dual GIP/GLP-1 agonist Mounjaro (tirzepatide), which is approved for diabetes and scheduled to be filed for approval in obesity shortly. Lilly, meanwhile, is also developing an oral GLP-1 agonist called orforglipron in phase 3 trials, as well as retatrutide, a triple-acting drug targeting GIP, GLP-1, and glucagon in phase 2.

“By unifying the knowledge and expertise in incretin biology at Lilly with the deep understanding of activin biology at Versanis, we aim to harness the potential benefits of such combinations for patients,” said Lilly’s head of diabetes, obesity, and cardiometabolic research, Ruth Gimeno.

Lilly aims to buy Versanis for up to $1.925 billion, inclusive of an upfront payment and subsequent milestones tied to development and sales objectives.

Novo Nordisk, meanwhile, is attempting to follow Wegovy with a follow-up combination in phase 3 known as CagriSema, which is based on semaglutide and amylin analogue cagrilintide, while other companies - including Amgen and Pfizer - are also working on oral GLP-1 candidates.

The takeover comes as analysts have started to predict a new wave of pharmacological therapies for obesity that could drive a market worth tens of billions of dollars worldwide.

By 2032, Morningstar analyst Karen Anderson estimates that approximately 21 million individuals around the world could be taking GLP-1-based therapy for obesity, supporting a market worth $60 billion.