Novo Nordisk Adds Obesity And Diabetes To AI Drug Research Pact With Valo Health

Novo Nordisk has significantly expanded its artificial intelligence collaboration with Valo Health, committing $190 million to broaden their research into obesity and type 2 diabetes. The expansion builds upon their initial 2023 partnership in cardiovascular disease, nearly doubling the program count from 11 to 20.

The new investment package includes an upfront payment, equity investment, and potential near-term milestone payment, with total milestone payments potentially reaching $4.6 billion. This represents a substantial increase from the original agreement's $2.7 billion potential milestone structure, which began with a $60 million upfront payment.

Despite Novo Nordisk's strong market position with GLP-1 agonist semaglutide (marketed as Ozempic for diabetes and Wegovy for obesity), the company continues to invest in next-generation medicines development. Their recent Phase 3 results for CagriSema, a combination of semaglutide with cagrilintide, showed statistically significant results, though weight loss outcomes were below market expectations.

Valo Health, launched in 2020 and backed by Flagship Pioneering, employs its Opal Computational Platform to predict drug safety and efficacy through AI-driven simulations. CEO Brian Alexander emphasized the company's human-centric approach: "Our experience with the Novo Nordisk partnership to date has demonstrated clear evidence of both the platform's technological capabilities as well as the human-centric approach to data and ways of working internally and with partners."

The collaboration has already identified several novel targets with potential for differentiated cardiometabolic drugs, with multiple small molecule programs currently in preclinical development. While specific targets remain undisclosed, this expansion reflects growing confidence in AI's role in drug discovery and development.

Recently, Valo announced the suspension of its diabetic retinopathy program OPL-0401 after failing to meet primary or secondary endpoints. However, this compound was not developed using their Opal platform, and the company remains focused on leveraging their AI technology for new medicine development, including those covered under the expanded Novo Nordisk agreement.

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