Merck on Wednesday signed a deal worth up to $2 billion with Hansoh Pharma to develop and sell the Chinese biotech's experimental oral obesity drug that works similar to the popular weight-loss treatments Wegovy and Zepbound.

Merck announced a weight loss drug deal Wednesday with China-based Hansoh worth up to $2 billion for the pill code-named HS-10535. It includes a $112 million licensing rights payment for global sales outside China.

Merck threw its hat into the obesity race on Wednesday, inking a deal worth up to $2.01 billion with Hansoh Pharma for its weight-loss drug.

And that's why Merck could credibly become the next big weight-loss stock. Before you rush to go buy shares of Merck, appreciate two things about its prospects of becoming a heavyweight in weight loss.

Merck & Co – known as MSD outside the US and Canada – will be gaining exclusive global rights to Hansoh Pharma’s preclinical GLP-1 candidate in a deal worth over $2bn. The agreement gives Merck a global licence to develop,

News of Merck’s licensing of Hansoh’s preclinical medicine pressured shares in Viking and other obesity drug developers seen as likely buyout targets.

Merck & Co. snagged a potential drug in the burgeoning market for obesity medications in a deal worth as much as $2 billion.