In a $2.7 billion agreement with Carmot, Roche joins the obesity drug market

In an attempt to challenge the leading producers of weight-loss medications, Novo Nordisk and Eli Lilly, Roche has agreed to pay $2.7 billion to acquire obesity drug developer Carmot Therapeutics.

The Swiss pharmaceutical company said in a statement on Monday that Carmot's equity holders will get payments of up to $400 million if specific milestones are met, in addition to the $2.7 billion upfront purchase price.

The most promising medication candidate for the takeover target, CT-388, is a dual GLP-1/GIP receptor agonist, the same class as Zepbound and Mounjaro from Lilly.

Since taking over in March, Thomas Schinecker, the new CEO of Roche, has set a fast pace to revive the company's drug development pipeline, which suffered significant setbacks in late-stage trials for cancer immunotherapy and Alzheimer's disease last year.

Roche, looking to expand into new therapeutic areas to counteract declining oncology sales, agreed in October to pay Roivant and Pfizer an initial $7.1 billion for the rights to a new drug for inflammatory bowel disease.

According to Roche, Carmot's current portfolio consists of several preclinical programs in addition to clinical-stage gut-hormone medications in pill and injection form that are intended to treat obesity in patients with and without diabetes.

Employees of Carmot will join Roche's pharmaceutical division upon the transaction's official closing, which is anticipated to occur in 2024's first quarter.

All clinical and preclinical assets in Carmot's current R&D portfolio will be made available to Roche.

(Sources: investing.com, reuters.com)