Rhythm Pharmaceuticals has entered a global licensing agreement with South Korea-based LG Chem for the latter’s weight loss drug LB54640, which is currently in Phase II clinical development.

Rhythm will pay $40m in cash and $20m in equity at deal closing, as per a 4 January press release. The US-based company will also pay $40m in cash 18 months after closing. LG Chem will also be entitled to receive up to $205m in milestone-based payments and royalties on sales.

LB54640 is a melanocortin-4 receptor (MC4R) agonist, which simulates the MC4R pathway to reduce hunger and promote weight loss. As part of the agreement, Rhythm will assume sponsorship of two Phase II trials, SIGNAL and ROUTE, investigating LB54640.

The Phase II SIGNAL trial (NCT06046443) is evaluating the drug in patients with acquired hypothalamic obesity. The placebo-controlled trial is expected to enrol approximately 28 patients. Participants will receive one of three doses of LB54640 once daily for up to 52 weeks. The primary endpoint of the study is measuring the change in body mass index (BMI) from baseline after 14 weeks of treatment.

The second Phase II ROUTE trial (NCT06041841) is evaluating patients with obesity and either proopiomelanocortin (POMC) deficiency, leptin receptor (LEPR) deficiency or proprotein convertase subtilisin/kexin type 1 (PCSK1) deficiency. The open-label trial will enrol approximately five participants with either of the three genetic dispositions. The primary endpoint of the study is the change in BMI after 14 weeks of treatment compared to baseline.

LB54640 demonstrated dose-dependent weight reduction in overweight adults in a Phase I trial (NCT06040372). Additionally, no changes in blood pressure or heart rate were observed. The drug received orphan drug designation from the US Food and Drug Administration (FDA) for LEPR deficiency and POMC deficiency, which are genetic disorders that cause obesity.

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Rhythm’s portfolio consists of another MC4R agonist Imcivree (setmelanotide). Imcivree received FDA approval for Bardet-Biedl syndrome or Alström syndrome in 2021.

The weight loss management market has experienced significant growth in recent years, with Novo Nordisk being the market leader in the field. The company’s weight loss drugs Wegovy (semaglutide) and Saxenda (liraglutide) generated Dkr30.4bn ($4.36bn) in combined global sales in the first nine months of 2023, as per Novo Nordisk’s Q3 2023 financials.

The overall obesity market is forecasted to grow from $6bn in 2023 to exceed $43.3bn in 2029, as per GlobalData’s market model.

GlobalData is the parent company of Clinical Trials Arena.