Dive Brief:

• Novo Nordisk is again looking for help outside its own laboratories as it works to build on the success of Ozempic and its sister medicine Wegovy.
• In the latest deal, Novo will provide research funding for Replicate Bioscience as well as up to $550 million in payments to work on new treatments for obesity, Type 2 diabetes and other cardiometabolic disorders.
• The agreement includes an unspecified amount of cash upfront as well as money tied to certain milestones, Replicate said Thursday.

Dive Insight:

Novo vaulted into the ranks of the world’s most valuable drugmakers in recent years after introducing Ozempic for diabetes and Wegovy for obesity. Rival Eli Lilly had similar success with its entrants into the GLP-1 drug class. But both companies failed to keep up with demand, and supply shortages opened the door to cheaper compounded versions that continue to hold back growth.

In July, Novo cut its financial forecasts, sending its shares spiraling. The company also lost its CEO, Lars Fruergaard Jørgensen, who announced plans to step down in May. Company veteran Maziar Mike Doustdar took over the top job this month.

Against that backdrop, Novo has remained active building out its research pipeline. The deal with Replicate follows collaborations announced last year with three different companies backed by Flagship Pioneering. In May of this year, Novo inked a deal with the biotechnology company startup Septerna to work on developing pills for obesity.

Replicate specializes in self-replicating RNA. The idea is to build on the success of messenger RNA products by designing medicines that can spur the body to make more therapeutic proteins that last longer. Co-founder Nathaniel Wang has described the process as “delivering a copy machine into the cell” along with the “instruction manual” that comes with messenger RNA.

For Novo, the new deal expands on previous investments into various forms of RNA technology. In 2021, the Danish drugmaker agreed to a $3.3 billion purchase of Dicerna Pharmaceuticals, a specialist in RNA interference drugs. Last year, the company announced plans to buy RNA drug developer Cardior and its experimental heart failure treatment for as much as $1 billion.