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AbbVie Joins Obesity Treatment Market With Up to $2.2B Licensing Deal

1. AbbVie licenses weight-loss drug GUBamy from Gubra for up to $2.2 billion. 2. Drug is in Phase 1 trial, competing with Eli Lilly and Novo Nordisk. 3. Market for weight-loss drugs projected to reach $130 billion by 2030. 4. AbbVie pays $350 million upfront, potential $1.875 billion during development. 5. AbbVie shares rose over 1% following the announcement, up nearly 20% this year.

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Why Bullish?

AbbVie's entry into a lucrative market could enhance its revenue stream. Historical entries into new markets have historically led to positive stock performance.

How important is it?

This news signals AbbVie’s diversification strategy into the weight-loss market, which is essential for future growth amid competition.

Why Long Term?

Successful development and commercialization could yield significant long-term revenue. Similar past drug approvals took several years to mature but resulted in sustained gains.

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