Another competitor in obesity drugs market; Roche shares gain 5.5% 📈

Roche (ROG.CH), is turning a new page in the company’s history after acquiring rights to an obesity therapy from Denmark’s Zealand Pharma (ZEAL.DK).

The deal signals a renewed push by Roche to catch up with obesity market leaders Novo Nordisk (NOVOB.DK) and Eli Lilly (LLY.US).

Under the agreement, Zealand Pharma will receive $1.65 billion upfront with the possibility of milestone payments, bringing the total to $5.3 billion, depending largely on late-stage trials and sales development, Roche said.

Zealand Pharma shares rose 26% following the announcement.

Jefferies analysts wrote in a note that they believe that Zealand Pharma's petrelintide could be better than Novo Nordisk's CagriSema, hence the nearly 4% discount in the company's shares.

Source: Distribution of rates of return in the pharmaceutical sector. Source: xStation