Novo Nordisk’s latest deal with Valo Health aims to boost its cardiometabolic position

Novo Nordisk will broaden its cardiometabolic pipeline by pairing up with machine learning and drug discovery startup Valo Health in a deal that builds on the Danish pharma’s stature in the growing field.

In exchange for $60 million upfront and in near-term payments, Novo will get its hands on three cardiovascular assets created by Valo’s computational work, the companies said Monday morning.

Nearly $2.7 billion in milestone payments are on the line for up to eight more programs in the deal with Boston-based Valo, and it will pay for R&D work and could dole out royalties, should any programs make it to market.

Novo will tap into Valo’s real-world patient data and human tissue modeling platform. Valo’s small molecule discovery work will also be put to the test as the companies collaborate across the entire drug discovery process, they said.

Marcus Schindler

“Artificial intelligence and machine learning hold the promise to positively impact drug discovery and development, in particular enabling our vision of leveraging human datasets early in the process, which should lead to a better understanding of target biology,” Novo’s scientific chief Marcus Schindler said in a statement.

The agreement marks another chapter in Novo’s cardiometabolic deal spree. The drugmaker last month bought Canadian biotech Inversago Pharma, which is doing work in diabetes, obesity and other metabolic diseases. In May, it paired up with North Carolina startup Life Edit Therapeutics on gene editing therapies for rare and cardiometabolic diseases.

Valo penned the Novo deal after acquiring cardiovascular drug discovery startup TARA Biosystems last year.

“We are excited to implement the full spectrum of our platform spanning from disease characterization through clinical development as we aim to deliver new therapeutics to benefit patients living with some of the most prevalent chronic diseases of our time,” Valo founder and CEO David Berry said in a statement.

Valo declined to comment beyond the press release.

The partnership with Novo is a boon for Valo, which had sought to go public in 2021 via the hype of blank check companies. But its deal with Khosla Ventures’ SPAC faltered, and the two “mutually agreed” to terminate their pact in November of that year, spelling the end to Valo’s $2.8 billion valuation and life on the public markets.

Back in 2019, prolific biotech creator Flagship Pioneering launched the computational startup, which initially had a focus on cardiovascular disease, neurodegeneration and cancer. It has raised nearly $600 million to date, per PitchBook. Valo also works with Charles River on small molecule drug discovery, and it’s made a few acquisitions along the way.

The biotech currently has one clinical trial. Last year, it started a Phase II of an oral small molecule candidate for non-proliferative diabetic retinopathy. The trial of OPL-0401 is expected to wrap up next summer, per the federal trials database. Valo earlier this year pulled its plans for a Phase II test of another asset, OPL-0301, in patients with left ventricular dysfunction after experiencing a heart attack.

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