Novartis agrees $5.7bn degrader deal with Monte Rosa

Novartis has signed its second licensing deal with Monte Rosa Therapeutics in less than a year, suggesting it is impressed with the US biotech's molecular glue degrader (MGD) platform.

The latest agreement covers degraders to treat immune-mediated disorders and gives Novartis an exclusive license to an undisclosed discovery target plus options on two preclinical-stage drug candidates in return for an upfront payment of $120 million and a whopping $5.7 billion if all clinical, regulatory, and commercial targets in the alliance are met.

MGDs are drugs that encourage two proteins that would not normally interact to stick together. Usually, the aim is to join disease-associated proteins with cellular components that cause them to be broken down and recycled. A key characteristic is that they can target previously "undruggable" proteins that lack suitable binding pockets required for conventional drug activity.

Last October, Novartis paid $150 million upfront to Monte Rosa – with up to $2.1 billion at the back end – for an orally-active, VAV1-directed MGD with potential in diseases like multiple sclerosis, rheumatoid arthritis, and inflammatory bowel disease.

The lead candidate in the VAV1 programme, codenamed MRT-6160, has since advanced beyond initial clinical testing and is being prepared for phase 2 trials. Meanwhile, the Boston-based biotech also has an ongoing, $2 billion partnership with Roche for MGDs targeting cancer and neurological diseases that was signed in 2023.

"We believe this new agreement further strengthens our relationship with Novartis, a recognised global leader in immune-mediated diseases, and reflects the expansive opportunity in the space for our highly selective and potent MGDs," said Markus Warmuth, Monte Rosa's chief executive.

Shares in Monte Rosa had risen more than 50% in pre-market trading at the time of writing, as investors responded to the new endorsement of its AI-powered QuEEN drug discovery engine.

The company has also updated on progress with its internal pipeline of MGDs, which are focused on the immunology/inflammation and oncology categories.

Monte Rosa's lead programme is MRT-8102, targeting NEK7, with potential in a broad range of indications, including osteoarthritis, gout, metabolic dysfunction-associated steatohepatitis (MASH), obesity, pericarditis, and atherosclerotic cardiovascular disease (ASCVD). A phase 1 study in healthy volunteers is currently recruiting subjects.

It also has a follow-up, brain-penetrating NEK7 candidate that is being developed for obesity as well as neurodegenerative diseases, as well as a GSPT1-targeting MGD (MRT-2359) for prostate cancer that is also due to start human testing shortly and early-stage cancer programmes targeting CDK2 and CCNE1.

For Novartis, the licensing deal comes at a time of frenetic pipeline-building, just a few days after it agreed to buy Tourmaline Bio and its phase 3-ready drug for ASCVD for $1.4 billion and a $5.2 billion licensing agreement with China's Argo Biopharmaceutical in the cardiovascular area.