Roche Enters Obesity Arena with Carmot Acquisition

The already massive GLP-1 obesity drug segment might have gained a major future competitor last week, following Roche’s acquisition of weight loss biotech Carmot Therapeutics.

The acquisition comes with a $2.7B purchase price, and another $400M in potential milestone payments – a notable premium above Carmot’s $385M in funding and three-times the $1B valuation that potential acquirers were reportedly evaluating in September.

That premium is even more notable given that Carmot’s portfolio might not become widely available until the 2030s. However, Roche surely hopes that Carmot’s weight loss pipeline will be worth the wait…

Carmot’s leading candidate is known as CT-388, a Phase 2-ready weekly GLP-1/GIP injection that, like Lilly’s tirzepatide, activates both GIP (affects adipose tissue regulation and storage) and GLP-1 (increases feeling of fullness and decreases gastric emptying) hormone receptors.

  • CT-388 is currently targeted for obese and overweight patients with or without diabetes

Carmot’s arguably most-notable candidate is known as CT-996, a daily oral GLP-1 Phase 1 drug for patients with obesity and type 2 diabetes, that could give Roche a differentiated weight loss option compared to the injectables currently on the market.

The biotech also has a once-daily dual GLP-1/GIP injectable (yes, daily) that’s in Phase 2 trials and would treat obese or overweight patients with type 1 diabetes.

Although Roche seems like a weight loss newcomer, it was actually among the first pharma companies to evaluate GLP-1s a decade ago, before halting trials. Now it re-enters a very different GLP-1 segment, with extremely high patient demand and just as high competitive focus from other pharma giants.

That combination is driving what will likely be a wave of similar weight loss drug acquisitions and investments, jumpstarted by….

Although Roche will have some catching up to do in the GLP-1 arena, the company believes that its strengths in diabetes and muscle building drugs could streamline this transition, and could even lead to future combined drugs that drive weight loss without muscle loss. 

The Takeaway

In addition to the reminder that it’s a great time to be a GLP-1 biotech, Roche’s acquisition of Carmot Therapeutics is another sign that we’re still in the early innings of the GLP-1 ballgame. By the time the weight loss drug market reaches the $100B-$200B size that everyone is predicting, we’ll almost certainly be talking about a far more diverse set of weight loss players and drug options.

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