Eli Lilly and Company

Nektar Therapeutics was awarded $90 million in damages after a jury found Eli Lilly in breach of contract over its handling of a drug for which Nektar held co-development and commercialization rights dating back to 2017, bringing the gross amount to roughly $115 million including simple interest, or about 5% of Nektar's market capitalization. The verdict, disclosed in Cedar Grove Capital Management's third-quarter 2026 investor letter, resolves a multi-year overhang on the stock, though the firm noted it had hoped for more, as Nektar had sought as much as $1 billion. Before the verdict, a jury note asking the judge to explain the difference between no breach and breach with a $1 damage award spooked the market, wiping more than $200 million from Nektar's market capitalization, a loss that did not recover once the verdict came in Nektar's favor and was exacerbated by rising Treasury yields. Nektar closed at $39.91 on October 06, 2026, with a $1.36 billion market capitalization and a 6.40% year-to-date pullback, trading within a 52-week range of $33.40 to $109.00. Cedar Grove's Multi-Strategy Composite returned -12.7% in the third quarter of 2026, trailing the Russell 2000, Russell Microcap, and S&P 500, and has returned -26.2% since its January 14, 2026 inception.

Novo Nordisk said new real-world data from its COMPETE SWITCH Cardiovascular study found that type II diabetes patients who increased their Ozempic dose had a lower observed risk of major adverse cardiovascular events than those who switched to Eli Lilly's Mounjaro. In the study, 67.2% of patients remained on Ozempic 1 mg within 365 days, 29.2% increased their dose to 2 mg and 3.6% switched to Mounjaro; by 720 days, 57.4% remained on semaglutide 1 mg, 36.9% had escalated to 2 mg and 5.7% had switched to Mounjaro. After adjustment for between-group differences, patients who increased their dose to Ozempic 2 mg had a statistically significant 6% lower risk of MACE than those who switched to Mounjaro, including doses of up to 15 mg, with MACE defined as all-cause death, heart attack and stroke. Novo cautioned that the study showed an association, not proof, that Ozempic 2 mg directly reduces cardiovascular risk more than Mounjaro, and that safety outcomes were not evaluated. Year to date, Novo shares have lost 22.2% against the industry's 14.9% growth.

Novo Nordisk has signed a licensing agreement with Hengrui Pharma for HRS-1596, a phase I-ready GLP-1/GIP dual receptor agonist with potential for once-weekly oral dosing. Under the deal, Novo gains exclusive rights to develop, manufacture and commercialize the candidate globally outside mainland China, Hong Kong, Macao and Taiwan, with a total potential value of up to $2.6 billion including a $300 million upfront payment plus potential sales royalties; Hengrui has received approval in China to begin phase I studies of HRS-1596 for weight management and type II diabetes, and the transaction is expected to close in the fourth quarter subject to regulatory and customary conditions. The agreement builds on Novo's February partnership with Vivtex, under which Vivtex licensed selected oral drug-delivery technologies to Novo and is eligible for up to $2.1 billion in upfront consideration, research funding and milestone payments plus royalties, and on last year's exclusive global collaboration with Septerna, which received a $195 million upfront payment under an agreement providing for approximately $2.2 billion across upfront, research, development and commercial milestone payments plus tiered royalties. Novo is pursuing this external innovation strategy because semaglutide-based products, comprising Ozempic and Rybelsus for T2D and Wegovy for obesity, generated roughly 75.5% of its adjusted first-half 2026 sales, leaving it heavily exposed to competition and exclusivity shifts. Rival Eli Lilly's tirzepatide-based Mounjaro generated $18.6 billion in first-half 2026 sales, up 106%, while Zepbound sales rose 60% to $9.1 billion, and Lilly's oral obesity treatment Foundayo launched in the United States in April and is under regulatory review in more than 40 additional countries. Novo's first-half Ozempic sales declined 2% at constant exchange rates while Wegovy product sales increased 7%, and its latest outlook calls for both adjusted sales and adjusted operating profit to decline 0% to 6% at constant exchange rates in 2026.

Roche's experimental obesity drug enicepatide helped overweight or obese patients with type 2 diabetes improve blood sugar control while losing an average of 15.5% of their body weight in a mid-stage trial, adding another potentially important asset to the company's effort to challenge obesity-market leaders Eli Lilly and Company and Novo Nordisk A/S. In the 447-patient study, patients receiving the highest 24-milligram dose experienced significant reductions in HbA1c at 48 weeks, meeting the study's two main goals, and Roche said approximately 62% of patients achieved HbA1c levels below 5.7%, putting their blood sugar into the non-diabetic range. The findings follow a separate mid-stage result reported in June in which enicepatide helped overweight or obese patients without diabetes lose 22.7% of their body weight; Roche said the two weight-loss figures should not be directly compared because they come from separate trials involving different patient populations. Roche plans to begin late-stage glycemic-control and cardiovascular-outcomes studies during the first half of 2027, though enicepatide remains an experimental drug and the latest results should not be treated as evidence of regulatory approval or eventual commercial success. Roche said around 2% of patients taking enicepatide in the 447-patient study discontinued treatment because of side effects, compared with none in the placebo group, with most gastrointestinal side effects described as mild to moderate, and the company is betting on next-generation therapies in an obesity market expected to exceed $100 billion in annual sales within the next decade, where AstraZeneca and Amgen are among the large drugmakers also racing to break in.

A federal jury in California has awarded Nektar Therapeutics $90 million in damages after finding that Eli Lilly breached the implied covenant of good faith and fair dealing. The lawsuit, filed in August 2023, stemmed from a prior licensing agreement between the two companies covering development and commercialization of the drug rezpegaldesleukin. The trial in the U.S. District Court for the Northern District of California began on September 8, and the jury delivered its verdict on September 24. Beyond the $90 million in damages, the court will determine the amount of interest to be added to the award, and the decision remains subject to post-trial proceedings and possible appeal. Separately, Nektar in July 2026 initiated the first two global registrational trials in the Phase 3 ZENITH AD program evaluating rezpegaldesleukin in moderate-to-severe atopic dermatitis, part of a three-study program that also includes ZENITH AD-3.