Lilly bets up to $1.9B on Versanis’ PhIIb weight loss drug, due for mid-2024 readout

Eli Lilly will pay up to $1.925 billion in cash for weight loss drugmaker Versanis, marking the Big Pharma’s fourth acquisition this summer after deals for DICE Therapeutics, Sigilon and Emergence Therapeutics.

The acquisition could pay out in the near future, as Versanis last month guided to a Phase IIb readout for its monoclonal antibody in the middle of 2024. Trial investigators are testing whether the asset, dubbed bimagrumab, alone and in combination with Novo Nordisk’s semaglutide, can “substantially prevent the loss of muscle mass observed with semaglutide and other incretin therapies” while also reducing fat.

The 48-week trial is testing multiple doses of the drugs and recently completed enrollment of 507 people. If the study is successful, Lilly plans to test bimagrumab with one of its own GLP-1s rather than Novo’s blockbuster Wegovy, Versanis chair and CEO Mark Pruzanski said in a Friday morning interview.

In Phase III, Lilly would plan to investigate bimagrumab alone and in combination with tirzepatide, which is the ingredient in its diabetes drug Mounjaro, he said.

Mark Pruzanski

“They have been keenly aware along the way that one potential shortcoming of incretin therapies in general, even more broadly any appetite-suppressing modality for the purpose of weight loss, is the loss of lean mass in patients,” Pruzanski said. “They were attracted to the idea that combining incretin therapies with a drug like bimagrumab could not only further the fat loss, which is really the problem in obesity, but also preserve muscle mass.”

The Versanis deal adds to the Indianapolis drugmaker’s arsenal of bets in the burgeoning weight loss drug market, anticipated to balloon into the tens of billions of dollars over the coming years. Tirzepatide is nearing a weight loss approval, and Lilly plans to launch three Phase III trials for its next-gen retatrutide next month. More assets are in the clinic and in the research labs of Lilly, whose shares $LLY were up 2.5%.

A breakdown between the size of upfront payment and milestones was not divulged in the Friday morning press release. Lilly declined to comment beyond the release and Pruzanski, the former Intercept founder and CEO, declined to share specifics.

Lilly’s recent string of acquisitions has brought in oral small molecules for autoimmune diseases, a preclinical diabetes cell therapy and antibody-drug conjugates for cancer, a deal that Lilly spokespeople have repeatedly declined to share details about.

Bimagrumab aims to block activin and myostatin signaling. The IV-administered drug had been through more than a dozen clinical trials by the time Versanis was founded in 2021 by Aditum Bio, a biotech incubator out of ex-Novartis leaders Joe Jimenez and Mark Fishman. They poached the antibody from their former employer’s pipeline and reeled in $70 million from Atlas Venture and Medicxi to bankroll the mid-stage study in weight loss.

Heart failure in obesity and other indications could potentially be explored down the road, per Versanis’ pipeline page. It’s been studied in people with COPD, type 2 diabetes, sporadic inclusion body myositis, and hip fractures, among others.

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