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Novartis to Pay Monte Rosa 0 Million Upfront to Develop New Class of Drugs

Novartis to Pay Monte Rosa $150 Million Upfront to Develop New Class of Drugs

Novartis (NYSE: NVS), the Swiss pharmaceutical giant, will pay Monte Rosa Therapeutics (NASDAQ: GLUE) $150 million upfront payment for a global license to develop, manufacture and sell some drug candidates, the U.S.-based biotech firm said on Monday.

The agreement covers a class of drugs called “molecular glue degraders,” which target abnormal protein functions associated with some diseases that are hard to treat with existing medications.

Monte Rosa will also be eligible for future payments of up to $2.1 billion and royalties on net sales outside the U.S.

Shares of Monte Rosa (NASDAQ: GLUE) surged 32% to $6.46 in premarket trade following the news.

CONTEXT

Novartis (NYSE: NVS) is bracing for the loss of U.S. patent protection next year for its bestseller Entresto and for Promacta to treat a lack of blood platelets.

WHY IT’S IMPORTANT

Among the candidates, Novartis will get access to MRT-6160, for which Monte Rosa is currently conducting an early-stage study for immune-mediated conditions. Novartis will take over the development of the candidate from mid-stage trials.

Like many major pharmaceutical companies, Novartis has been actively securing deals to strengthen its drug pipeline and mitigate the impact of losing exclusivity on key medications.

The Swiss company is also streamlining its operations by cutting jobs and costs and sharpening focus on fewer therapeutic areas and geographic markets.

KEY QUOTE

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

(Source: Reuters)

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Jennifer Tacker
Jennifer Tacker is a staff writer at ABBO News. She holds a B.A. from the University of Waterloo and a B.Ed from Western University. Jennifer has been active in the stock market and crypto sector for a decade. She specializes in technical analysis and trading strategies.