If the pursuit of Metsera signaled that Novo Nordisk was ready to pay top dollar for the right innovation, the aftermath has filled Tamara Darsow’s calendar with high-stakes screenings for new opportunities.
What was once a barren field five years ago is now in a “virtuous cycle,” a transformation Darsow felt firsthand as the Novo senior vice president of global business development and her colleagues triaged 200 meetings with existing and potential future partners at the J.P. Morgan Healthcare Conference in San Francisco.
With more than 60 people from Novo attending, including the entire executive management team, this year marks the largest presence the Danish pharma has had at the annual healthcare event, where biopharma companies large and small come together in a whirlwind of four days to talk business and deals.
With a green light from new CEO Mike Doustdar that the Danish pharma “can go very big, very big in buying something in,” Darsow is searching for the missing pieces of the company’s obesity and diabetes puzzle that spans from early-stage collaborations to late-stage acquisitions.
“The more people that are interested in this field, and the more investment that comes into obesity, the more opportunities there are to take advantage of through collaboration and business development,” Darsow said in an interview with Fierce on the sidelines of JPM. “It’s just night and day, and I think there will continue to be a virtuous cycle.”
The bidding war against Pfizer for Metsera last year inevitably raised questions about whether Novo has become an eager buyer, a signal of desperation that could undermine the Danish company’s position in future negotiations. A connection could easily be drawn between Novo’s recent aggressiveness in dealmaking and a critical need to defend its obesity crown amid increasing competition from other pharma giants like Eli Lilly.
Yet, Darsow dismissed the notion that has tipped Novo’s hands. Instead, she framed the Metsera move as a declaration of intent that “we were serious about getting the right innovation into our pipeline.”
The bid for Metsera centers on a potentially once-monthly injectable GLP-1 and an amylin analog. To Darsow, the biotech was very complementary to Novo’s internal pipeline.
“Our strategy is very much around serving all patients with obesity and diabetes, and the patients come with very different needs,” Darsow said. “Obviously increasing efficacy is one of those needs, but there are many others.”
Novo is looking at novel mechanisms that can impact obesity in different ways than the incretin pathway, or “complementary mechanisms […] that could help patients that have specific types of disease pathology.”
“When we think about the patients that we’re trying to reach, obviously one of the things that everybody is very interested in is, of course, greater weight loss, but the patients have other unmet needs, like more tolerable, more convenient treatments, that will help serve different patient populations within the huge group of people that have obesity,” Darsow added. “So there’s a lot of different angles that you can take, and it is definitely not a one-size-fits-all population.”
Novo’s interest in complementary assets was also reflected in its $5.2 billion purchase of Akero Therapeutics last year. While Novo’s Wegovy is already approved to treat adult metabolic dysfunction-associated steatohepatitis (MASH) patients with moderate to advanced fibrosis (stages F2 and F3), Akero’s FGF21 analog efruxifermin has shown promise in reaching MASH patients with compensated cirrhosis (F4).
Although the chase for Metsera had a price component, with Pfizer winning out by raising its offer from the initial $7.3 billion to up to $10 billion, Darsow said Novo’s dealmaking strategy is “not about the size of the deal as much as it’s about the right deal.”
“When we’ve gained conviction that it’s the right deal, then we can talk about the price,” she said.
“We will be very disciplined,” she later added. “But when we have conviction, we’ll move with intent.”
Novo has a strong balance sheet, and Doustdar has indicated the company’s willingness to aggressively deploy its treasury. But the battle for Metsera also included a non-price component.
In attacking Novo’s counteroffer for Metsera, Pfizer leveled an argument designed to strike a note with U.S. antitrust authorities. By casting Novo as “a company with dominant market position” that intended “to suppress competition […] by taking over an emerging American challenger,” Pfizer sought to turn the Danish giant’s success into a liability.
While the U.S. Federal Trade Commission didn’t weigh in on the point, the same argument could be made for any future Novo acquisitions of a U.S. biotech or asset during a competitive bidding process and potentially hamstring the company’s M&A activities. Besides, burdened with a perceived regulatory risk, Novo might be asked to pay a punitive premium to convince future sellers.
For Darsow, however, the landscape is far too crowded for such labels to stick.
“We definitely were the first company in obesity. We’ve been working in the space for a very long time,” Darsow said. “But, over the last few years, there’s been a massive influx of both new assets and new companies in this space. We believe there will be plenty of competitive companies in the space and a lot of assets that will come along. We’re not worried about that.”
Metsera was not the only setback Novo has suffered recently on the M&A front. The company’s potential $1.3 billion deal for a hypertension med from KBP Biosciences has led to an $816 million write-off and a bitter fraud accusation. As part of a companywide restructuring under Doustdar, Novo also called off an allogeneic cell therapy collaboration with Heartseed worth nearly $600 million biobucks.
The KBP brouhaha revealed what could be viewed as shortfalls in Novo’s due diligence process. According to evidence KBP presented to a Singapore court, Novo did not open a critical document containing raw patient data until after the deal closed.
As legal proceedings between the two companies remain ongoing, Darsow didn’t talk about any specific lessons Novo took from the case.
“With every deal, we do a post hoc,” she said. “Sometimes things don’t work out. That’s the nature of business development. But we were confident moving forward.”
While the fallout from the KBP deal—a company with Chinese roots—threatened to tarnish the reputation of China’s biotech industry, Novo is not holding any grudges against China. As Western pharma giants increasingly look East to bolster their pipelines, including in obesity and metabolic diseases, Darsow remains open to what China has to offer, and the focus is on clinical relevance rather than geography.
“We’re very engaged in the Chinese ecosystem. There’s a lot of opportunity and a lot of assets in the market,” the Novo BD chief said. “We’re again agnostic to where things come from and more really focusing on the quality of the individual company and asset and the science around it.”
As to Heartseed, Darsow stressed that it was “a prioritization exercise” rather than a deal gone wrong.
“This came from the focused strategy, where we’ve not just focused on obesity, diabetes and the related complications,” Darsow said. “We’ve also narrowed our scope of focus around modality platforms.”
Novo recently ended all cell therapy R&D work and just passed some diabetes cell therapy technologies to partner Aspect Biosystems, with Novo retaining an option to reengage for late-stage development and commercialization.
Now, with that focused strategy championed by Doustdar, Darsow said Novo is not looking for deals outside of those areas. The instruction she got from the CEO is to “broaden and deepen our obesity and diabetes pipelines and complement the internal pipeline.”
Rather than any specific metric that Doustdar is holding the BD team responsible against, “it’s about the quality and the makeup of the assets,” she said.
Editor's Note: The story was updated with the correct name of Akero's FGF21 analog and to clarify the nature of the Aspect Biosystems deal.