Zealand Pharma rakes in $1bn in funding for obesity drugs
David Kendall, chief medical officer at Zealand Pharma
Fresh from reporting encouraging results with its obesity drug candidate petrelintide, Zealand Pharma has raised an impressive $1 billion from a new share offering.
The Danish biotech started the fundraising process earlier this week with an expectation of raising $900 million, but easily overshot that target, evidence once again of huge investor interest in companies developing a new generation of obesity drugs.
Last week, Zealand reported that a course of 16 weekly injections with long-acting amylin analogue petrelintide reduced body weight by an average of 8.6%, compared to 1.7% with a placebo shot, in a phase 1b trial. The drug was also well-tolerated, with just one of 48 study subjects discontinuing therapy due to side effects.
Shares in the company rose sharply after the data was announced, which showed that targeting amylin could be a viable alternative to weight loss to therapies based on GLP-1 agonists, such as Novo Nordisk’s Wegovy (semaglutide) and Eli Lilly’s Zepbound (tirzepatide), and may deliver “a better patient experience,” according to Zealand’s chief medical officer, David Kendall.
The company has also said it believes that petrelintide may eventually become the mainstay of obesity treatment, perhaps with other drugs used in combination to boost its efficacy, thanks to its tolerability profile.
Zealand’s most advanced project is Boehringer Ingelheim-partnered glucagon/GLP-1 receptor dual agonist survodutide, already in phase 3 testing, but the company will use the new funding for its other obesity programmes.
Petrelintide is due to start a phase 2b trial later this year, and Zealand also has a GLP-1/GLP-2 receptor dual agonist dapiglutide that has shown preliminary efficacy in the phase 2a DREAM trial, with an average weight loss of 4.3% after 12 weeks with a low dose. Higher doses of dapiglutide are under evaluation in an ongoing phase 1b study.
In a statement, Zealand said that the net proceeds from the new offering will go towards taking those programmes into “phase 2b clinical trials and beyond,” and help build manufacturing capabilities. It will also support continued early-stage research and fund general corporate activities.
The offering was for 8.35 million shares at a subscription price of DKK 843 per new share. The stock is currently trading at DKK 872, not far off its 52-week high, having surged after the announcement of the petrelintide data last week.
