Roche's Innovation in Basel and the Weight Loss Market

Swiss multinational pharmaceutical giant Roche announced the opening of pRED Center Basel earlier today. The pRED Innovation Center Basel is a collective of new R&D facilities “designed to accelerate transformative discovery and collaboration.” The Pharma Research and Early Development center (pRED) is dedicated to research in 7 categories: Cardiovascular & Metabolism, Immunology, Infectious diseases, Ophthalmology, Neurosciences, Rare Diseases, and Oncology.

The opening of the pRED Center in Basel, Switzerland comes with excitement for potential new developments. The center was designed with the best elements observed from other Roche research centers like those based in Zurich and Munich in mind. Having filed more than 103 patent applications in 2023 alone, pRED is likely to continue to drive development of new therapeutics for the Swiss pharma company. 

The opening comes along with poor early-stage trial results from Roche’s weight loss pill CT-996 that saw shares drop 5.4%. Roche’s attempts to break into the weight loss market heavily dominated by Lilly and Novo Nordisk, who saw respective share prices rise 2% and 4.3% amidst the news from Roche, are not all done. The company plans to expand more rigorous trials next year to help gather more definitive data on the matter. CT-996 and CT-388 were two drug candidates developed by Carmot Therapeutics. Acquired by Roche earlier this year, Carmot Therapeutics was a clinical stage biotech company that specialized in drug development for individuals with obesity and diabetes. Roche and Carmot Therapeutics agreed to a deal that saw a $2.7 billion upfront payment with $400MM in potential milestone achievements. According to Reuters, some analysts place the weight loss market at a valuation of $100B; it is easy to see why Roche wanted a share of the pie that is currently dominated by Lilly and Novo Nordisk.

Novo Nordisk, manufacturer of Ozempic amongst other weight loss drugs, released results regarding daily weight loss pill Amycretin. After 3 months of treatment in a phase 1 clinical trial, individuals saw a reduction in body weight of up to 13%, “nearly double the weight loss rate seen in current GLP-1 agonists’ according to Dr. Christopher McGowan.

Earlier this year in late June, the House “Ways and Means” committee passed a bill that would allow Medicare to cover weight loss drugs. The two drugs that were the focus of the bill are Wegovy and Zepbound, owned by Novo Nordisk and Eli Lilly respectively. Currently, Medicare coverage for Wegovy is limited to individuals with increased risk of stroke, heart attack, and other grave cardiovascular problems. Without insurance, individuals can expect to pay an average of about $1500 per month for Zepbound ($18,000 per year annualized). Obviously unaffordable for the vast majority of Americans, the bill looks to expand access to the weight loss drug. Proponents offer that individuals treated with Zepbound and other weight loss drug alternatives are at a reduced likelihood for other medical ailments as a result of obesity. Opponents of the bill counter that there are better methods for weight reduction that do not involve government subsidies. Regardless of stance in regard to the bill, the weight loss market will continue to be one of the largest markets targeted by big and small pharmaceutical companies looking to strike gold alike.

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