Red-Hot Obesity-Drug Maker Novo Nordisk Soars To Record On A $2.7 Billion Deal
Novo Nordisk stock hits record high on a deal in diabetes and obesity treatment.
The stock of Novo Nordisk (NVO), a Danish pharmaceutical company, soared Wednesday after it signed a deal that could be worth as much as $2.7 billion and will help the company to improve its diabetes and obesity treatments.
Aspect Biosystems, a privately-held company, will be the partner of the company. Aspect has extensive experience in bioprinting tissue. Novo is an expert in stem cell differentiation, cell therapy and cell therapy. Together, the two companies plan to develop bio-printed tissue to replace, repair, or supplement biological functions. Aspect will receive $75 millions upfront and milestone payments of up to $650,000,000 per product. The companies will be developing up to four products.
Novo Nordisk has a long history of working in the field of diabetes and obesity. Saxenda, and Wegovy are the only obesity drugs approved by Novo. Ozempic, a diabetes injection, has also gained cult status for its weight loss properties.
Today, Novo Nordisk closed at 163.52 after a 3.3% jump on the stock exchange.
The collaboration will initially focus on the development of bio-printed tissue that helps maintain normal blood glucose levels, which is a crucial component in treating diabetics.
Novo claims that the treatments are allogeneic. This means they will come from one source. Mass production will be possible. These treatments are not always successful, as the body often rejects donor tissue. Novo said that the companies are hoping their treatments will not require immunosuppressive drugs.
This news comes at an important time for Novo Nordisk, whose stock is trading at record highs on the enthusiasm surrounding its obesity treatments. While competitors such as Eli Lilly (LLY), Amgen(AMGN)and Viking Therapeutics(VKTX) are also pursuing similar weight loss efforts.
MarketSmith.com reports that Lilly shares have formed a cup with a purchase point of 346.73. Amgen is in a long consolidation, with a 296.77 entry.
The stock of either Viking or Novo Nordisk is not forming a foundation. Both stocks are highly rated. Novo has an IBD Digital relative strength rating of 95. This puts it in the top 5 percent of all stocks for 12-month performance. Viking's RS rating is a perfect 100.
Editor's note: This article has been updated with the correct value of the transaction.
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