Merck announced on December 18, 2024, that it has entered into a licensing deal worth up to $2.01 billion with Hansoh Pharma for its weight-loss drug, HS-10535. This strategic move marks Merck's entry into the highly competitive obesity market. The agreement grants Merck exclusive global rights to develop, manufacture, and commercialize the GLP-1 receptor agonist.
This development introduces a new, well-resourced competitor into the burgeoning weight-loss drug space. Merck's decision to license an external asset, rather than pursuing an acquisition of a company like Viking Therapeutics, may shift market perceptions regarding potential M&A activity involving smaller biotech firms in the sector. The entry of another major player underscores the significant commercial opportunity in obesity.
For Viking Therapeutics, the news of Merck's deal could be viewed as a negative development, as it adds to the already intense competition from established players like Eli Lilly and Novo Nordisk. The market reacted to this news with Viking's shares plummeting, reflecting concerns about increased competitive pressure and the potential impact on its own obesity drug candidates.
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