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LG Chem Licenses Obesity Drug Candidate to Rhythm Pharmaceuticals for $350 Million

The strategic partnership aims to advance the development of LB54640, targeting rare genetic obesity through the MC4R pathway
South Korea
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LG Chem Ltd. has reached a significant agreement with Rhythm Pharmaceuticals Inc., a U.S.-based biotech company, to license out LB54640, a promising drug candidate for rare genetic obesity currently in phase 2 clinical trials. The deal, valued at up to $350 million, highlights LG Chem’s ongoing efforts in innovative pharmaceutical development.

Under this agreement, LG Chem will receive an immediate $100 million from Rhythm Pharmaceuticals for licensing its oral small molecule melanocortin-4 receptor (MC4R) agonist, LB54640. This drug has shown potential in suppressing appetite and reducing weight, as evidenced in phase 1 trials.

In addition to the upfront payment, LG Chem is set to receive up to an additional $250 million, contingent on LB54640 achieving certain regulatory approvals and sales milestones. Furthermore, LG Chem will earn sales royalties from the drug’s market performance.

Genetic obesity often stems from abnormalities in the MC4R pathway, which impairs appetite control, with symptoms typically appearing in childhood. LB54640, which has been granted orphan drug designation by the US Food and Drug Administration (FDA), is being developed specifically to address MC4R pathway diseases.

Rhythm Pharmaceuticals’ CEO, David Meeker, has expressed confidence in LB54640, highlighting its potential as a specific therapy for MC4R-related obesity, devoid of side effects like hyperpigmentation or cardiovascular issues.

Post-agreement, Rhythm Pharmaceuticals will oversee two phase 2 studies focusing on LB54640’s efficacy in weight loss, along with its safety, tolerability, and pharmacokinetics.

LG Chem’s decision to out-license LB54640 aligns with its broader strategy to expand its pharmaceutical portfolio, particularly in the U.S. market. This move follows LG Chem’s $571 million acquisition of AVEO Pharmaceuticals Inc., reinforcing its position in the anti-cancer drug market and underscoring its commitment to addressing complex health challenges through strategic partnerships and innovative research.

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