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Roche has agreed to buy obesity-drug developer Carmot Therapeutics for up to $3.1 billion, as the world’s top drugmakers rush to capitalize on the booming market for weight-loss drugs that has seen Novo Nordisk become Europe’s most valuable company.
The acquisition gives Roche exclusive access to the Carmot’s portfolio of three trial-stage GLP-1 agonists, which include two subcutaneous injections that are currently in Phase 2 trials as well as a daily tablet that is currently going through Phase 1 trials.
Shares in Roche
ROG,
increased 3% on Monday. The Swiss drugmaker has lost 31% of its value over the past 12 months.
The deal will see Roche, which was first founded in 1896, pay Carmot’s equity holders $2.7 billion upfront, and up to $400 million later, depending on the achievement of certain milestones. All 70 of Carmot’s employees will join Roche’s pharmaceutical division.
Roche’s acquisition comes as the world’s top drugmakers are increasingly seeking to cash in on the rapidly-expanding market for obesity drugs, which has seen Ozempic-maker Novo Nordisk become the most valuable company in Europe.
The Danish firm’s successes have seen pharmaceutical companies pile into the market, in a race that has seen both Pfizer
PFE,
and AstraZeneca
AZN,
seek to develop GLP-1 agonists that could rival Novo Nordisk’s blockbuster medicines, Ozempic and Wegovy.
As of now, the only companies with GLP-1 agonists that have been approved for obesity in either the U.S. or European Union are Novo Nordisk
NOVO.B,
and Eli Lilly
LLY,
whose injectable weight loss drug Zepbound was approved by the Food and Drug Administration in November
In their efforts to capitalize on the multibillion-dollar market for GLP-1 drugs, pharma giants are now seeking to develop orally administered alternatives to the injectable drugs that are currently the only GLP-1 drugs available to treat obesity.
Market leaders Eli Lilly and Novo Nordisk are both currently seeking to develop their own orally administered obesity drugs, with the Danish firm aiming to file for U.S. and E.U. approval of its medicine this year.
Pfizer shares tumbled on Friday after saying it was forced to discontinue trials of its own twice-daily weight loss pill, Danuglipron, after more than half of patients dropped out of trials due to side effects including nausea and vomiting. Pfizer said it would now focus on a once-daily formulation of Danuglipron.
In November, AstraZeneca struck a $2 billion deal with Eccogene through which the Anglo-Swedish company gained an exclusive license to market the Shanghai biotech company’s experimental once-daily weight-loss pill that recently completed Phase 1 trials.
The rise of GLP-1 agonist weight loss drugs has also impacted wider markets, with Walmart
WMT,
CEO John Furner telling Bloomberg in October that appetite suppressing medicines have caused customers to buy less food.
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