MW This biotech's stock rockets on oral obesity drug partnership with Wegovy parent

By James Rogers

Novo Nordisk looks to harness Septerna's broader GPCR drug pathways, which include GLP-1, for obesity and diabetes treatments

Shares of Septerna Inc. were soaring in early Wednesday trading after the biotech clinched a partnership with Wegovy and Ozempic parent Novo Nordisk to collaborate on oral obesity and Type 2 diabetes medicines.

Oral obesity medication could offer an alternative to injectable medications, such as Novo Nordisk's (DK:NOVO.B) $(NVO)$ Wegovy and Ozempic.

In a statement, the companies said they would harness Septerna's $(SEPN)$ expertise in G protein-coupled receptor $(GPCR)$ drug discovery. GPCRs are cell membrane receptors that regulate physiological processes in nearly every organ system of the human body.

Related: Novo Nordisk shares are rising after the company cut its outlook. It's been that kind of year.

Septerna's stock rocketed 64.2%, making it the biggest premarket gainer on major U.S. exchanges, according to FactSet data.

Septerna and Novo Nordisk will initially work on four development programs for potential oral small-molecule therapies to one or more GPCR targets, including the gut hormones GLP-1 and GIP and glucagon receptors. GLP-1 is a key hormone for appetite reduction, and is targeted in Wegovy and Ozempic, as well as Eli Lilly's $(LLY)$ Zepbound.

However, during a conference call to discuss Novo Nordisk's first-quarter results last week, Chief Executive Lars Jorgensen said that the oral weight loss drug will be "way smaller" in market size than current injectable medications.

Nonetheless, the Septerna partnership is a significant one. The South San Francisco company is eligible to receive up to $2.2 billion from Novo Nordisk, including more than $200 million in upfront and near-term payments, the companies said. Septerna is also eligible to receive tiered royalties on global net sales of marketed products. Novo Nordisk will cover all research and development expenses for the partnered programs.

In addition to obesity and Type 2 diabetes, the partnership will develop medications for other cardiometabolic diseases, according to Septerna and Novo Nordisk.

The Novo Nordisk partnership comes as a pleasant surprise for Septerna investors, as the stock has languished since the company went public in Oct. 25, 2024 at an initial public offering price of $18.

Septerna shares had closed Tuesday at $6.73, or 62.6% below the IPO price. Over the same time, the iShares Biotechnology ETF IBB has dropped 15.6% while the S&P 500 index SPX has gained 1.3%.

Steve Goldstein contributed.

-James Rogers

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May 14, 2025 09:00 ET (13:00 GMT)

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