Roche Strikes $3.1 Billion Deal for Obesity Drugmaker. It’s Hoping to Compete with Eli Lilly, Novo Nordisk.
Roche, the Swiss pharmaceutical company, has announced its agreement to acquire Carmot Therapeutics, an obesity-drug developer, for up to $3.1 billion. This move aims to position Roche alongside industry leaders Eli Lilly and Novo Nordisk in the weight-loss drug market.
Carmot Therapeutics, a private U.S. company, specializes in the development of GLP-1 receptor agonists, a class of drugs used for both obesity and diabetes treatment. The acquisition provides Roche with exclusive access to Carmot’s portfolio of three trial-stage GLP-1 agonists. Among them are two subcutaneous injections currently undergoing Phase 2 trials, as well as a daily tablet being tested in Phase 1 trials.
In a research note, Jefferies analyst Peter Welford mentioned the competitive advantage of Carmot’s lead asset, particularly in combination with Roche’s muscle-preserving candidates. Roche’s interest in Carmot aligns with its pursuit of weight loss and muscle mass treatments, a trend also seen in Eli Lilly’s recent acquisition of Versanis Bio for up to $1.93 billion. Versanis is currently developing a drug that promotes muscle mass increase while stimulating fat metabolism.
Under the deal, Roche will pay $2.7 billion upfront, with an additional $400 million dependent on the achievement of specific milestones. Roche CEO Thomas Schinecker expressed enthusiasm about the merger, stating that by combining Carmot’s portfolio with Roche’s Pharmaceuticals pipeline and Diagnostics expertise, they aim to enhance the standard of care for cardiovascular and metabolic diseases.
The news of the acquisition has impacted stock prices, with Roche shares trading up 1.9% in Switzerland. However, the company’s shares remain down 16% year-to-date. Eli Lilly and Novo Nordisk, on the other hand, have shown a positive trajectory in the market this year.
In the competitive weight-loss drug market, multiple pharmaceutical companies are striving to develop innovative solutions that also address comorbidities. For instance, AstraZeneca recently announced an exclusive licensing agreement with Chinese company Eccogene worth up to $2 billion. This collaboration focuses on developing a drug targeting obesity and Type 2 diabetes.
Roche’s acquisition of Carmot Therapeutics underscores its commitment to advancing in the weight-loss drug race. With the combined efforts of industry leaders and emerging players, there is immense potential to revolutionize obesity and diabetes treatment, ultimately improving patients’ lives worldwide.
Sources:
– Adam Clark. (Publication Year). ‘Roche Strikes $3.1 Billion Deal for Obesity Drugmaker. It’s Hoping to Compete with Eli Lilly, Novo Nordisk.’ Retrieved from [source link]
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