Roche will partner with Zealand Pharma to co-develop and co-commercialize Zealand’s petrelintide for overweight and obesity indications, the companies said, through a collaboration and licensing agreement that could generate more than $5.3 billion for the Danish biotech.
Petrelintide is an amylin analog intended for once-weekly subcutaneous administration, and allowing for co-formulation and co-administration with other peptides since it has been designed with chemical and physical stability with no fibrillation around neutral pH.
“We strongly believe that petrelintide holds potential as a foundational therapy for weight management, addressing unmet medical needs among the majority of people living with overweight and obesity, both as a stand-alone therapy and in combination with other agents,” Adam Steensberg, Zealand’s president and CEO, said in a statement. “This collaboration with Roche is a step change to realize this vision, while solidifying Zealand Pharma as a key player in the future management of obesity.”
Investors largely appeared to share Steensberg’s optimism. Shares of Zealand traded on Nasdaq Copenhagen surged 38% from DKK 488.80 ($71.54) to an even DKK 674 ($98.38), while Roche shares traded on the SIX Swiss Exchange rose about 4% from CHF 296.50 ($335.83) to CHF 307.30 ($348.38).
“We commend management for identifying Roche as the partner for lead asset petrelintide,” Andy T. Hsieh, PhD, a biotech-focused research analyst with William Blair, wrote in a research note. “Roche’s clinical development prowess and global commercial infrastructure, we now hold a more bullish view on the prospect of petrelintide emerging as an important therapeutic intervention for chronic weight management.”
Hsieh reiterated Blair’s “Outperform” rating on Zealand stocks.
The companies cited clinical and preclinical data showing amylin receptor activation to reduce body weight by restoring sensitivity to the satiety hormone leptin, inducing a sense of feeling full faster. As a result, Roche and Zealand reason, petrelintide could deliver weight loss comparable to glucagon-like peptide 1 (GLP-1) receptor agonists but without the side effects associated with GLP-1 drugs.
Speaking with CNBC, Steensberg said Zealand launched talks with potential partners last year and had received a “high degree of interest” from several companies. Roche was “by far the most desirable,” citing its past activity in obesity drug development, including its acquisition of Carmot Therapeutics for up to $3.1 billion, completed in January 2024.
Steensberg added that Zealand was unlikely to have partnered with the market leaders in GLP-1 drug development, Novo Nordisk and Eli Lilly, reasoning that both companies were too tied to their existing multi-billion-dollar blockbuster obesity/diabetes franchises. Novo Nordisk markets semaglutide for adult type 2 diabetes as Ozempic® and for obesity as Wegovy®, while Eli Lilly markets tirzepatide for type 2 diabetes as Mounjaro® and for obese or overweight adults as Zepbound®.
Under study
Petrelintide is under study in a pair of Phase IIb clinical trials:
• ZUPREME-1 (NCT06662539), assessing the drug in obese/overweight people without type 2 diabetes (T2D) and launched in December 2024.
• ZUPREME-2, which will evaluate the drug in obese/overweight people with T2D when initiated later in the first half of this year.
Roche and Zealand agreed to co-develop and co-commercialize petrelintide both as monotherapy and in potential combinations in the United States and Europe, including a combo of petrelintide and CT-388, Roche’s lead incretin asset and a GLP-1/GIP [gastric inhibitory polypeptide] receptor dual agonist designed for once-weekly subcutaneous injection.
CT-388 is under study in Phase IIb clinical trials as a treatment for overweight/obesity patients with and without T2D. Roche inherited CT-388 when it acquired Carmot.
According to Roche, CT-388 was designed to have both potent activity on both the GLP-1 and GIP receptors and minimal to no ß-arrestin recruitment on either receptor. Such signaling significantly minimizes receptor internalization and consequent desensitization, which is expected to lead to prolonged pharmacological activity, the companies reason.
“We share the vision to develop petrelintide as a future foundational therapy,” stated Teresa Graham, CEO of Roche Pharmaceuticals. “By combining petrelintide with our Pharmaceuticals portfolio and with our Diagnostics expertise in cardiovascular and metabolic diseases, we are aiming to transform the standard of care and positively impact patients’ lives.”
Through the collaboration, while Roche and Zealand will co-commercialize petrelintide in the United States and Europe, Roche will obtain exclusive rights to commercialize the drug in the rest of the world, and be responsible for commercial manufacturing and supply.
Roche has agreed to pay Zealand $1.65 billion cash upfront—of which $1.4 billion will be due when the deal closes, and the remaining $250 million to be due over the first two anniversaries of the collaboration.
Zealand is also eligible to receive up to $1.2 billion in payments tied to achieving development milestones—primarily linked to the launch of Phase III trials with petrelintide monotherapy—as well as up to $2.4 billion in sales-based milestones, and tiered double-digit royalties up to high teens percentages on net sales in the rest of the world.
“A good partner”
“Roche’s global reach and ambitions in the CVRM [cardiovascular, renal and metabolism] therapeutic area make it a good partner for petrelintide, in our view,” Lucy Codrington, MBChB, equity analyst with Jefferies, wrote in a research note.
Codrington noted that her firm currently forecasted $10 billion in worldwide petrelintide peak sales at 60% probability for a share price of DKK 390 net present value (the value of all future cash flows, positive and negative, over the entire life of an investment discounted to the present).
The Roche-Zealand collaboration exceeds the value projected by her firm of a potential partnership deal for petrelintide of up to $4.25 billion in upfront and potential milestones, plus tiered royalties of 12–22% on worldwide net sales.
However, Zealand agreed to pay Roche $350 million, offsettable against milestone payments, for the petrelintide/CT-388 fixed-dose combination product or next-generation petrelintide combination products the companies have agreed to develop through the collaboration.
Roche and Zealand have also agreed to share profits and losses for petrelintide and the petrelintide/CT-388 combination 50/50 in the United States and Europe.
The transaction is set to close in the second quarter, subject to regulatory approvals and other customary closing conditions.