Novartis is planning to buy U.S.-based biotech Excellergy for up to $2 billion, betting on a next-generation allergy treatment that may prove to work faster and better than anything currently on the market, the Swiss pharmaceutical giant said Friday.

The acquisition will add Exl-111, an early-stage drug candidate, to Novartis’ existing allergy portfolio. It is the latest bolt-on deal in the company’s attempt to offset looming patent expirations.

It comes just a week after Novartis announced it is acquiring Synnovation subsidiary Pikavation Therapeutics for up to $3 billion to secure the rights to an experimental breast cancer drug. 

In February, the company completed the acquisition of Avidity Biosciences, adding three late-stage programs to its neuromuscular pipeline, with potential for several launches before 2030. 

Excellergy’s lead asset remains several years away from hitting the market. Novartis said it will pay the smaller biotech in both upfront and milestone payments, and the transaction is expected to close in the first half of 2026, subject to regulatory approvals.

Novartis stock traded sideways in morning trading in Zurich. Palo Alto-based Excellergy is privately held.

Many of the best-selling drugs in the world are facing a loss of exclusivity in key jurisdictions in what the sector calls “the patent cliff.” By the turn of the decade, companies risk losing hundreds of billions in revenue as branded drugs are exposed to generic competition.

Like the second half of 2025, early 2026 has seen a slew of M&A announcements from Big Pharma, including Merck announcing it has reached an agreement to buy Terns Pharmaceuticals for up to $6.7 billion earlier this week. Britain’s GSK and AstraZeneca are also among the companies that have announced several deals over the past months.

GSK’s global head of business development Chris Sheldon told CNBC late last year he is looking for acquisitions often in mid-stage development in the $1 billion to $2 billion range, where the biology is validated biology but the outcome of a drug candidate isn’t yet obvious. Like Novartis and AstraZeneca, GSK looks for so-called bolt-on deals that complement its portfolio and technology.

Novartis warned earlier this year that profits would decline in early 2026 as some of its best-selling drugs, including heart medicine Entresto face generic competition. Its second-best-selling medicine Cosentyx is expected to lose key exclusivities around 2029.

“For the first half of the year, we will have a tough prior year base with Entresto, Promacta and Tasigna generics having entered the U.S. market mid-2025,” said then-incoming CFO Mukul Mehta in a post-earnings call with analysts in February.

Novartis is seeing strong growth in other medicines such as cancer drug Kisqali and multiple sclerosis treatment Kesimpta, but still has to bulk up its pipeline to offset declines. 

CEO Vas Narasimhan has said that the company is in the middle of the biggest patent expiration wave in the company’s history.

“It’s $4 billion that we will absorb over the course of this year across the three medicines,” Narasimhan told CNCB in February.

Abivax is planning to raise money after releasing key trial data in June, its CEO told CNBC on Tuesday, signaling to potential buyers of the firm that it is in no rush to sell.

Intense takeover rumors have surrounded the French biotech company for months, impacting the volatile stock that rose nearly 1,700% in 2025. Analysts see it as a prime takeover target, and several pharma giants have been rumored as potential buyers. 

A second late-stage trial assessing the long-term, maintenance effect of Abivax’ lead, and only, asset obefazimod will read out late in the second quarter. Subject to positive data, it plans to apply for U.S. Food and Drug Administration approval in the fourth quarter, the company has said.

The drug is widely seen as a potentially best-in-class medicine for ulcerative colitis and is also being tested as a treatment for Crohn’s disease, opening it up to a multi-billion-dollar market for Irritable Bowel Syndrome (IBS).

“It’s more logical again, for outside of the U.S. to wait post maintenance, because, as you know, the terms are going to be better… since we’re confident that this study is going to read positively,” Abivax CEO Marc de Garidel said, when asked about future partnerships and deals.

“Why hurry,” when the company is three months away from the readout, he said.

Investors see the next trial results as a major inflection point for the company and one that potential buyers are watching closely.

It is “really likely” Abivax will raise funds through a potential combination of equity financing and debt after the maintenance data, de Garidel said. “We are currently assessing how much money we need to raise in, let’s say, late June… to take us to profitability.” Funds raised would be at least several million, he added.

The company has consistently emphasized that it has enough cash to carry it through late 2027, and on Monday reported a cash pile of 530 million euros ($613 million) as of the end of 2025. In July last year, it raised nearly $750 million shortly after another clinical trial sent shares up 510% in one day.

Abivax appears to be signaling to potential buyers that it is in no rush to secure an offer. It also announced late on Monday that former Takeda Vice President Michael Nesrallah will take on the role of chief commercial officer.

Its research and development expenses in 2025 increased by 31.2 million euros to 177.8 million euros. Overall expenses will ramp up by late 2026 and 2027, mostly due to commercial expenses, de Garidel told CNBC, also highlighting more key hires on the commercial side over the next six months.

Biotech companies nearing launch must always make preparations to go at it alone without the backing or the acquisition by a larger peer, said Van Lanschot Kempen analyst Sebastiaan van der Schoot.

“But the overall assumption is that they will be acquired prior to approval and prior to launch,” van der Schoot said, adding that a positive maintenance trial readout is already largely priced in to the company’s share price.

Stifel analyst Damien Choplain said earlier this month that given the strength of Abivax’ earlier data and the scarcity of comparable assets, he expects a deal could be made ahead of the maintenance data readout, even if a post‑readout could maximize value.

A global launch is too much for the still small company, which currently only has around 150 employees, said de Garidel.

“After the maintenance readout, outside of the U.S., we will look for a partner, or partners depending upon who is interested and the profile of those companies, to try to launch outside of the U.S,” he added.

However, U.S. President Donald Trump’s so-called Most Favored Nation drug pricing policy has become a complication as it eventually looks to launch obefazimod outside of the U.S. MFN refers to pegging drug prices in the U.S. to the lowest level paid in a comparable country.

When the company eventually finds a partner outside of the U.S., “we have to bear in mind that everything this partner does outside of the U.S. doesn’t jeopardize what happens in the U.S.,” de Garidel said.

The chief executive of drugmaker Zealand Pharma sought to calm investors about the latest trial results, which showed patients lost less weight than expected and prompted the stock to fall more than 35%.

Speaking to CNBC, CEO Adam Steensberg criticized what he called the “weight loss Olympics,” where markets and companies focus too heavily on the amount of weight lost, rather than on factors such as staying on the medicine long-term and dealing with side effects.

The world doesn’t need these products that amount to very high rates of weight loss, he said, referring to medicines developed by Novo Nordisk and Eli Lilly. The latest trial had also not been optimized for maximum weight loss, he added.

“I need to focus on what the patients need, not what the current market like to see,” Steensberg said. “We have for a long time called to end the weight loss Olympics.”

Zealand is developing the drug petrelintide in partnership with Swiss pharma heavyweight Roche. Mid-stage trial results released after the closing bell on Thursday showed the drug led to an average weight reduction of 10.7% over 42 weeks. Analysts had largely expected between 13% and 20% weight loss.

Shares of Zealand were last seen trading 35% lower, on track for their worst day ever and the lowest close since August 2023. Shares of Roche fell 3%.

Addressing weight maintenance, rather than losing the most amount of weight quickly, has emerged as a way for companies to differentiate themselves as they try to enter the lucrative weight-loss drug market, which has been estimated to be worth as much as $150 billion by 2030.

Steensberg said he was “extremely certain” there would be a shift in the industry “towards tolerability,” referring to how well patients can cope with side effects of the medications.

“I think very, very soon, people start to realize that it’s not about that weight loss number, it’s about how you achieve that weight loss number.”

“If you then look into real world, you will actually discover that most patients who are on treatment today with the current products never get to those numbers that we see in clinical studies,” because “in a real-world setting, people cannot tolerate it,” he said, referring to Novo Nordisk’s and Eli Lilly’s drugs already on the market.

Petrelintide is an amylin analog that targets a hormone produced in the pancreas that affects appetite and slows gastric emptying, rather than the GLP-1 or GIP gut hormones targeted by weight-loss treatments currently on the market, such as Novo’s Wegovy and Lilly’s Zepbound.

A majority of patients on Novo’s Wegovy experience some form of side effects, most commonly gastrointestinal, such as nausea, diarrhea, and vomiting. Most are mild to moderate and transient. The trend is similar for Lilly’s Zepbound.

A Novo spokesperson said that direct comparisons between trials are challenging because of variations in study design and reporting practices. A study of a high-dose semaglutide, the active ingredient in Wegovy and Ozempic, found that patients lost up to 21% of their weight, with only 5.4% ending the treatment due to side effects, the spokesperson said. Only 3.3% discontinued the treatment due to gastrointestinal side effects.

Lilly didn’t respond to a CNBC request for comment.

In the trial results, Zealand said that at the maximum dose of petrelintide, there were “no cases of vomiting and no treatment discontinuations due to gastrointestinal adverse events.” The trial involved 493 people living with overweight and obesity.

It also has a drug under development that combines petrelintide with the Roche-developed CT-388, a GLP-1/GIP receptor, which Zealand says may be a better option for patients needing to lose a large amount of weight.

One study of more than 125,000 patients suggested that about 50% of people with obesity discontinue appetite-modifying GLP-1 medications within a year. High costs and side effects are common reasons for stopping.

A study published in the British Medical Journal in January found that people who lost weight with the help of GLP-1 drugs, regained weight significantly faster after stopping than those who lost weight with diet and exercise.

Obese patients who stopped GLP-1 medications were projected to return to their starting weight after 1.7 years, the study found, compared with 3.9 years for those who lost weight with behavioral change alone.

The rate at which patients lose weight on drugs has been a key factor driving stock prices for Novo and Lilly in recent years.

Novo shares are trading 75% below their peak in mid-2024, while Lilly shares have risen over the same period as its medicines were shown to deliver a higher rate of weight loss.

On Friday, Jefferies analysts said petrelintide had potential for Wegovy-like efficacy and tolerability on par with placebo which “suggests this is a viable drug.”

But they added it was likely to be viewed as a second-best to the amylin treatment being developed by Lilly.

“For us as a small company, to be among the leading products in a new category… is a very nice place to be,” said Steensberg, adding that it was early to make such calls.

“If you look historically at the markets, if you’re among the three first who launch into a new category with an attractive profile, you will become a very significant player in that category.”

He added that the latest trial hadn’t been optimized to maximize weight loss, as it had an almost 50/50 gender distribution, and that women tend to lose more weight than men.

“Most companies would approach that with 70% females,” he said, adding he was “confident” petrelintide would lead to a weight loss in the mid-teens once they have optimized starting conditions.

The trial results published Thursday were about “finding the doses and then demonstrating the safety and solid ability,” he said.

Zealand said it expected to initiate a Phase 3 study later this year. But Barclays analysts said that the market was unlikely to credit a Phase 3 “fix” for petrelintide in two years.

Novo Nordisk was the first company to make a GLP-1 drug for weight loss and became Europe’s most valuable company.

But its troubles are stacking up and today the stock trades at just a quarter of what it did at its peak less than two years ago.

Pricing pressure, fierce competition, and pipeline setbacks have all hit the Danish drugmaker in recent months.

Despite being first to launch a GLP-1 drug for weight loss, Novo’s market share has eroded, and the company now only captures about 40% of the market, while rival Eli Lilly holds 60%, according to most estimates.

Novo is clear-eyed about the challenges it faces, especially around pricing. After the company pre-released its 2026 forecast earlier this month and predicted declining sales, CEO Mike Doustdar told CNBC: “People should expect that it goes down before it comes back up.”

He’s repeatedly said that new medicines, the Wegovy pill, and increased volumes will drive long-term growth.

These charts show the scale of the challenges Novo is facing.

Novo Nordisk is often referred to as a diabetes and obesity pure play. Its portfolio included six branded drugs with annual sales of at least $1 billion in 2025, fewer than comparable current and future rivals.

Eli Lilly boasts eight so-called blockbuster drugs, and its portfolio also includes oncology and gene therapies.

The combined sales of Ozempic and Wegovy, Novo’s two biggest drugs, amounted to about $32 billion, or about 67% of total sales, last year. Combined sales of Lilly’s two biggest drugs, Mounjaro and Zepbound, were about $37 billion, or about 56% of the company’s total sales over the same period.

Novo also sells insulin, including blockbusters Tresiba and NovoRapid, as well as some drugs for rare diseases like hemophilia, but none come close to bringing in what its GLP-1 drugs do.

Among large-cap pharma companies hoping to enter the market for weight loss drugs in the coming years, such as AstraZeneca, Roche, Amgen, and Pfizer, through its acquisition of Metsera, the number of blockbuster drugs was significantly higher.

Novo Nordisk has also come under pressure as prices for GLP-1 drugs are coming down in its most important market, the U.S.

The U.S. has accounted for more than half of Novo’s total sales since 2023, and falling prices there are weighing on both the company’s topline and profitability. Last year, Novo and Lilly reached a deal with the Trump administration to lower prices on their GLP-1 drugs on Medicare and Medicaid and offer the treatments directly to consumers at a discount.

“In 2026, Novo Nordisk will face pricing headwinds in an increasingly competitive market,” said CEO Mike Doustdar, as the company’s full-year earnings report was published earlier this month.

Novo stock is down 75% since peaking at just over 1,000 Danish kroner a share in mid-2024.

The stock is up a little over 10% over the last five years. That compares to Eli Lilly’s 400% rise and the European blue-chip index Stoxx 600‘s 55% gain over the same period.

Investors were last rattled on Monday when Novo reported disappointing results of a trial pitting its next-generation weight loss drug, CagriSema, against Eli Lilly’s tirzepatide, also known as Zepbound, sending the stock down over 16% on the day.

“Confidence in the share is at rock bottom,” said Jyske Bank analyst Henrik Hallengreen Laustsen on Tuesday.

Earlier this month, Novo Nordisk said it expected sales and profits to drop by between 5% and 13% in 2026. If that comes to be true, it would be the first time annual sales have declined since 2017, in local currencies.

Analysts surveyed by FactSet expect sales to come in about 8% lower in 2026 compared to 2025. Much of that is due to increasing competition from both Eli Lilly and compounding pharmacies that are selling copycat versions of Novo’s branded drugs for a lower price.

Longer term, other large-cap pharma companies are planning to enter the market, and are pitching investors more differentiated weight loss drugs to be able to secure a slice of the market share for themselves.

Novo is hoping CagriSema can beef up future sales, but after the latest trial results, analysts are increasingly doubting its commercial potential.

Novo said it is optimistic about the drug, and that further trials would assess its full weight-loss potential.

The Wegovy pill is another potential growth driver for Novo and had a strong launch. However, it remains to be seen how it will fare if Lilly launches its rival pill, expected to hit the market in the second quarter, and what effects lower prices might have on volumes.