Jan 8 (Reuters) - Danish drugmaker Novo Nordisk

and U.S. tech firm Valo Health said on Wednesday they

were expanding their 2023 agreement to develop new treatments

for cardiometabolic diseases using human data and artificial

intelligence (AI).

WHY IT'S IMPORTANT

Last month Novo's drug candidate, CagriSema, showed weight

loss below expectations during a trial, dealing a blow to the

company's plans to soon introduce a successor to Wegovy, its

popular weight-loss drug.

Novo is trying to develop a weight-loss treatment more

powerful than Eli Lilly's ( LLY ) rival Zepbound.

Both Novo and Lilly are also testing their blockbuster

obesity drugs for a range of conditions as they race to show

that they have other health benefits.

Analysts estimate the obesity drug market would be worth

$150 billion in the next decade.

CONTEXT

Novo and Valo originally partnered in September 2023 in an

agreement to develop up to 11 drugs.

With the expanded agreement, Novo will collaborate with Valo

to discover and develop up to 20 new treatments for obesity,

type 2 diabetes, and cardiovascular diseases.

BY THE NUMBERS

Under the terms of the expanded agreement, Valo is entitled

to receive near-term payments totaling up to $190 million and

milestone payments of about $4.6 billion dollars.

In the original agreement, Valo was eligible to receive up

to $2.7 billion in milestone payments.

(Reporting by Christy Santhosh in Bengaluru; Editing by

Shinjini Ganguli)