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

The Hansoh deal will let Merck compete in the crowded oral GLP-1 space alongside fellow pharma giants Eli Lilly, Novo Nordisk and Roche.

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.