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Hi folks! I'm reporting from San Francisco for a special edition second newsletter of the week – a booster if you will – with what you need to know about the second day of the JPMorgan Healthcare Conference.
To no one's surprise, weight loss drugs were a hot topic at the annual conference, which gathered thousands of biotech and pharma execs, investors and analysts this week.
The dominant players in the segment, Novo Nordisk and Eli Lilly, both took the stage to talk about the soaring demand for their respective treatments and their views on other drugmakers racing to enter the space.
Even as his company holds a massive edge over most players in the booming space, Eli Lilly CEO David Ricks said competition could be a good thing for the weight loss drug market.
"I think here's a case where probably competition spurs us both on to go faster and build out more indications and really take the insight," Ricks said during a fireside chat, while also crediting Novo Nordisk for pursuing GLP-1s for obesity in the first place.
Ricks said Novo Nordisk, the leading maker of the drugs, is the competitor that's top of mind for Eli Lilly. But he also highlighted the large drugmakers buying into the weight loss drug market through acquisitions or partnerships, which he views as potential competitors that "we should all take seriously."
Novo Nordisk CEO Lars Fruergaard Jørgensen similarly welcomed competition during his own fireside chat.
The bigger problem, he said, is spreading awareness of obesity as a chronic disease, which needs medical intervention and the accompanying insurance coverage for treatment.
Meanwhile, Swiss company Roche told Bloomberg that it's on the hunt for more deals to challenge Eli Lilly and Novo Nordisk in the weight loss drug market.
Roche said it is looking for new ways to adjust metabolism that could ultimately be combined with the obesity treatments it's gaining from its up to $3.1 billion acquisition of Carmot Therapeutics, which was announced last month.
Elsewhere at the conference, GSK announced that it inked an up to $1.4 billion agreement to acquire asthma-focused drug developer Aiolos Bio.
That deal comes as the British drugmaker seeks to broaden its respiratory pipeline. It also comes as the company – like many others – prepares for the loss of exclusivity on some of its best-selling drugs, including a key HIV treatment later this decade.
GSK has already inked a flurry of deals over the last year, including the company's $2 billion acquisition of Canada-based Bellus Health, which has an experimental chronic cough drug in late-stage development. It also includes deals in the antibody-drug conjugate space with China-based Hansoh Pharma, which GSK CEO Emma Walmsley told CNBC could "build on the field we've already got."
And the deal spree doesn't seem to be over yet. Walmsley told CNBC that the company is also looking for deals with companies working on oncology and autoimmune treatments, noting that there's "just still so much unmet need" in those disease areas.
She added that the company is focused on smaller, bolt-on deals rather than ones that are "seismic" in size."
That's a similar approach that Novartis is taking, according to CEO Vas Narasimhan.
He told CNBC's Jim Cramer that the company is focusing on "sub-$5 billion assets," downplaying rumors that Novartis could acquire the biotech company Cytokinetics, which has a market cap of nearly $10 billion.
"While we look at larger deals, our M&A strategy is bolt-ons," he said.
Feel free to send any tips, suggestions, story ideas and data to me at annikakim.constantino@gmail.com.
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