Novo Nordisk is bulking up its obesity drug pipeline with the acquisition of Inversago Pharma, a biotech two months removed from reporting early clinical data showing its lead metabolic disease drug candidate led to significant weight loss. The deal is also a bet that Inversago’s approach can succeed where Sanofi failed.

Denmark-based Novo Nordisk said Thursday that it is acquiring privately held Inversago in a cash transaction. Specific financial terms were not disclosed, but the pharmaceutical giant said Inversago, based in Montreal, could receive up to $1.075 billion if development and commercialization milestones are met.

Inversago intends to treat metabolic and fibrotic diseases with drugs that target and block cannabinoid receptor type 1, or CB1. This receptor found throughout the central nervous system regulates various physiological processes. Some research has focused on drugging it to treat mood and anxiety disorders. This receptor has also been targeted as a way of suppressing appetite.

CB1 has been targeted successfully, but by a drug that was unsuccessful commercially. In 2006, the European Medicines Agency approved rimonabant, brand name Acomplia, a Sanofi-Aventis drug developed to treat obesity alongside diet and exercise. The company withdrew the product in 2008 after concerns about the psychiatric safety of the drug led to a regulatory review concluding that the product’s benefits no longer outweigh its risks.

Rimonabant never reached the U.S. market. In 2007, an FDA advisory committee voted against recommending approval, leading Sanofi-Aventis to withdraw its new drug application.

Novo Nordisk describes Inversago’s drugs as “next-generation CB1 receptor blocker therapies.” Inversago says lead drug candidate INV-202, a once-daily pill, is designed to specifically target CB1 receptors in peripheral tissues, such as those in the gastrointestinal tract, kidneys, liver, and pancreas. By targeting peripheral CB1 receptors, the company says it aims to avoid the side effects of earlier CB1-targeting efforts that also hit receptors in the brain.

In June, Inversago presented Phase 1b data for its lead drug during the annual meeting of the American Diabetes Association. Results from the 37-patient study showed clinically significant weight loss after 28 days, along with positive trends in measures of lipids and glucose in the blood. Side effects were mostly gastrointestinal but the drug was well tolerated by study participants and no serious adverse effects were reported.

Inversago has proceeded to a Phase 2 test in diabetic kidney disease. Novo Nordisk said it intends to investigate the potential of INV-202 for obesity and obesity-related complications. The pharma giant also gains Inversago’s preclinical programs for unspecified metabolic and fibrotic disorders.

The CB1-targeting approach of Inversago diversifies Novo Nordisk beyond its injectable metabolic disorder drugs, Ozempic for type 2 diabetes and Wegovy for obesity. Both are peptide drugs that contain the active pharmaceutical ingredient semaglutide, which activates the GLP-1 receptor to produce more of the glucose-regulating hormone insulin. This mechanism of action also leads to weight loss. Earlier this week, Novo Nordisk reported preliminary data from a five-year study showing that treatment with Wegovy led to a 20% reduction in cardiovascular problems.

Inversago revealed its science in 2018, when it announced a $7 million Series A financing to develop CB1-targeting drugs for Prader-Willi syndrome and type 1 diabetes. The company’s technology is based on the research of George Kunos, a National Institutes of Health scientists with expertise in CB1. Kunos’s preclinical research found that restricting the effects of CB1-blocking to peripheral receptors showed potential for treating metabolic disorders without also causing adverse CNS effects. In 2020, Forbion led a $35 million Series B funding round for the biotech. Last October, Inversago raised a $70 million Series C round led by New Enterprise Associates. In a prepared statement, Martin Holst Lange, Novo Nordisk’s executive vice president for development, said Inversago’s drugs strengthen his company’s pipeline.

“This promising class of medicine pioneered by the Inversago team could lead to life-changing new treatment options for those living with a serious chronic disease and, in particular, may offer alternative or complementary solutions for people living with obesity,” he said.

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