Key Takeaways Jiangsu Hengrui Pharmaceuticals has licensed its experimental obesity pill HRS-1596 to Novo Nordisk for up to $2.6 billion. Hengrui receives $300 million immediately, with an ad
As Novo Nordisk watches its stock tumble over 70% from all-time highs, the pharmaceutical giant is fighting back. With Eli Lilly steadily capturing market share in the lucrative obesity treatment space, Novo announced a major licensing partnership on Tuesday.
The Copenhagen-based pharmaceutical manufacturer has struck a deal valued at up to $2.6 billion with Jiangsu Hengrui Pharmaceuticals to obtain rights for an investigational weight-loss pill. This marks the second GLP-1 licensing partnership Novo has forged with a Chinese firm in 2025.
Under the terms, Novo acquires worldwide development and commercialization rights to HRS-1596, excluding mainland China, Hong Kong, Macao and Taiwan—territories Hengrui will continue to control.
The candidate drug operates as a dual GLP-1/GIP receptor agonist and remains in preliminary clinical testing. Chinese regulators have greenlit Phase 1 studies evaluating its potential for obesity and type 2 diabetes management.
The Chinese pharmaceutical company receives an initial $300 million payment from Novo. The remaining $2.3 billion is performance-based, contingent on hitting clinical, regulatory and commercial targets, supplemented by sales-based royalty payments.
According to Novo, HRS-1596 is being developed as a once-weekly oral medication. This would represent a significant advancement over existing daily pill formulations like Wegovy.
Mike Doustdar, Novo’s CEO, indicated earlier in April that oral medications will become increasingly central to obesity care strategies. This licensing agreement directly supports that vision.
A company representative informed Reuters that international clinical trials are being planned for HRS-1596, though specific timelines remain undisclosed.
The licensing deal comes as Novo faces mounting pressure from Eli Lilly, whose oral medication Foundayo directly challenges Wegovy. This competitive dynamic has contributed to Novo’s prolonged stock decline.
China has emerged as a hotbed for obesity drug innovation. According to Pharmcube analytics, nearly 250 GLP-1 receptor agonist programs are currently underway across Chinese biotech and pharmaceutical companies.
Novo isn’t alone in tapping China’s pipeline. Industry heavyweights including AstraZeneca, Merck and Pfizer have each secured licensing agreements for Chinese-developed GLP-1 compounds.
This represents Novo’s second Chinese partnership. The company previously licensed UBT251 from United Laboratories International, a candidate that demonstrated up to 19.7% body weight reduction over 24 weeks in clinical testing.
Industry analysts project the global obesity pharmaceutical market will reach approximately $100 billion in annual revenue by the mid-2030s. This enormous commercial opportunity continues to drive aggressive dealmaking across the sector.
Following the announcement, Hengrui’s Hong Kong-listed shares gained roughly 2%. This uptick contrasted with broader market weakness, as the Hang Seng Index declined around 1% during the same trading session.
The transaction remains subject to U.S. antitrust clearance and customary closing requirements. Both Novo and Hengrui anticipate finalizing the agreement in Q4 2026.
Eli Lilly has not issued any statement regarding potential licensing arrangements with Chinese obesity drug developers when contacted for comment.
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