Novartis Acquires Global License from Monte Rosa Therapeutics

(Reuters) – Swiss pharmaceutical giant Novartis (SIX:NOVN) will pay Monte Rosa Therapeutics $150 million upfront for a global license to develop, manufacture, and sell certain drug candidates, the U.S.-based biotech firm announced on Monday.

The agreement includes a class of drugs known as "molecular glue degraders," which target abnormal protein functions associated with diseases that are difficult to treat with current medications.

Monte Rosa may also earn future payments totaling up to $2.1 billion along with royalties on net sales outside the U.S.

Shares of Monte Rosa surged 32% to $6.46 in premarket trade following the announcement.

Context

Novartis is preparing for the loss of U.S. patent protection next year for its best-selling drugs Entresto and Promacta, used to treat a lack of blood platelets.

Importance

Among the drug candidates, Novartis will acquire MRT-6160, currently being studied for immune-mediated conditions, with Novartis set to take over development from mid-stage trials.

Like many major pharmaceutical companies, Novartis is actively pursuing partnerships to enhance its drug pipeline and offset the impact of losing exclusivity on key medications. The Swiss firm is also streamlining operations by cutting jobs, reducing costs, and focusing on fewer therapeutic areas and geographical markets.

Key Quote

"Novartis has had a long-standing interest in molecular glue degraders, which offer the potential to tackle challenging biological targets," stated Fiona Marshall, president of biomedical research at Novartis.