Novo Nordisk has signed another deal with Merrion Pharmaceuticals of Ireland which will see the firms develop and commercialise oral formulations of one of the Danish firm’s diabetes drugs.

Specifically, Merrion will apply its absorption-enhancing Gipet technology to one of Novo’s glucagon-like peptide-1 (GLP-1) receptor agonist. When asked by PharmaTimes World News, the Dublin-based firm’s chief executive John Lynch said that he could not reveal which GLP-1 compounds are involved in the deal, although it is worth noting that Novo is moving close to getting its injectable GLP-1 treatment liraglutide to market .

Under the terms of the agreement, Merrion will receive up to $58 million for the first product to reach the market based on achievement of certain development, regulatory and sales milestones, as well as royalties. Novo is also taking a 1.8% stake in the company, acquiring 300,000 shares at 3 euros each.

Mr Lynch noted that the deal follows an oral insulin analogue agreement signed in November, which also could be worth up to $58 million. He added that the latest link-up “demonstrates the potential for long-term partnership between our two companies and also enhances our capacity to develop our other products and technologies”.

The deal went down well with investors and the Irish company’s shares climbed 19.1% to 4.05 euros. Goodbody analyst Ian Hunter noted that this second deal “is a very strong positive for Merrion, further validating its drug delivery technology and putting the company on a strong cash footing”.