Zealand Halts Dual GLP-1/GLP-2 Agonist Development Amid Crowded Obesity Treatment Landscape

Zealand Pharma has announced the suspension of development for its dual GLP-1/GLP-2 agonist, dapiglutide, citing an increasingly competitive obesity treatment market. The decision comes as part of the company's strategic effort to reallocate resources towards programs with greater potential for clinical differentiation and long-term value creation.

Dapiglutide's Clinical Performance and Market Challenges

Dapiglutide, previously in phase 1 development for obesity-related comorbidities driven by low-grade inflammation, demonstrated an average weight reduction of 11.6% in phase 1b trial results earlier this year. While this outcome fell slightly short of analyst expectations, the decision to pause development was primarily influenced by the rapidly evolving competitive landscape in the GLP-1-based therapeutic space.

David Kendall, M.D., Zealand's chief medical officer, explained on an analyst call, "Although dapiglutide has demonstrated the potential for a competitive weight loss profile based on the results of clinical trials completed to date, the GLP-1-based therapeutic space has become increasingly crowded, requiring even greater and clinically meaningful differentiation for assets which would be launched in the 2030s and beyond."

Strategic Refocus on Differentiated Metabolic Assets

Despite halting dapiglutide's development, Zealand Pharma maintains a robust pipeline in the metabolic space. The company is redirecting its focus to other promising candidates, including:

1. Petrelintide: An amylin analogue partnered with Roche, currently in phase 2 testing for obesity.
2. Survodutide: A glucagon/GLP-1 receptor dual agonist in phase 3 development with Boehringer Ingelheim for obesity treatment.

Zealand also emphasized its early-stage pipeline, which includes novel mechanisms targeting obesity and inflammation, reaffirming its commitment to restoring and maintaining metabolic health.

Industry-wide Intensification of Obesity Drug Development

The decision by Zealand Pharma reflects a broader trend in the pharmaceutical industry, where companies are reassessing their obesity treatment portfolios in light of intense competition. Notable developments include:

• Roche's $2.7 billion acquisition of Carmot Therapeutics and subsequent $1.6 billion partnership with Zealand Pharma for petrelintide development.
• Pfizer's recent $10 billion acquisition of Metsera, featuring MET-097i, a monthly injectable GLP-1 asset in phase 2b testing.

These strategic moves underscore the pharmaceutical industry's growing focus on obesity treatments, as well as the increasing challenges faced by companies in differentiating their products in a rapidly evolving market.