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Roche forays into weight-loss therapy, buys Carmot for $2.7 billion

US-based Pacific Northwest National Laboratory, Microsoft Corp., and Micron Technology have joined hands to make computational chemistry available to researchers and industrial users.

HQ Team

December 4, 2023: In a strategic push into the obesity and diabetes treatment market, Roche, a leading pharmaceutical company, has finalized a merger agreement with Carmot Therapeutics, acquiring the company for an upfront payment of $2.7 billion.

The merger will allow Roche to take control of Carmot’s metabolic drug pipeline, consisting of three GLP-1 agonists targeted at combating obesity and associated comorbidities.

Roche’s press release revealed that Carmot’s equity holders could receive additional payments amounting to $400 million. This deal grants Roche access to Carmot’s three pivotal drug candidates, such as CT-388, a Phase II-ready subcutaneous GLP-1/GIP receptor agonist, which has shown promising potential for weight loss in patients dealing with obesity, both with and without type 2 diabetes.

Carmot recently announced its intention to debut on Nasdaq.

Roche’s foray in GLP-1

Interestingly, Roche was among the first to start experimenting with GLP-1 over a decade ago with its taspoglutide. However, due to severe side effects, including nausea and vomiting, the drug was abandoned and returned to its partner, Ipsen. Since 2010, no new studies on taspoglutide have been registered.

Expressing optimism, Roche’s Chief Medical Officer, Levi Garraway, highlighted the clinical data for CT-388, emphasizing substantial weight loss observed during Phase Ib trials. Garraway underscored the potential for a distinct profile capable of addressing obesity and its associated ailments effectively.

Beyond CT-388, Carmot’s pipeline includes CT-996, an oral GLP-1 receptor agonist in Phase I development for obesity, with and without type 2 diabetes, and another subcutaneous dual GLP-1/GIP receptor agonist in Phase II for overweight or obese patients with type 1 diabetes.

Roche’s portfolio

The anticipated closure of this deal in the first quarter of 2024 will grant Roche exclusive access to Carmot’s innovative Chemotype Evolution discovery platform, marking a significant leap in Roche’s pursuit of advancing treatments for metabolic diseases.

Obesity drug market

This acquisition marks Roche’s second major move this year, following its $7.1 billion investment in Roivant and Pfizer’s TL1A asset in autoimmune diseases. Carmot’s strategic collaboration with Roche aligns with its vision, outlined in its S-1 filing last month, acknowledging the need for a partner to navigate the complexities of pivotal trials and commercialization in competitive markets like obesity and type 2 diabetes.

Carmot was a key research player in the development of Amgen’s KRAS cancer drug, Lumakras.

Roche’s acquisition follows the lucrative interest generated in the obesity and diabetes drug spaces. Most major pharma companies have come up with an obesity drug. Earlier this year, AstraZeneca made headlines by securing an oral candidate from Chinese company Eccogene for $185 million upfront. Novo Nordisk’s Wegovy and  Eli Lilly’s Zepbound have already propelled the companies into the most valuable companies.

Carmot, poised to make strides in the weight-loss market, had approximately $246 million in cash, equivalents, and marketable securities by the end of September, with The Column Group as its largest shareholder, holding a 40% stake.

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