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Roche, the Swiss pharmaceutical giant, is making a bold attempt to break into the lucrative weight loss drug market, currently dominated by heavyweights Novo Nordisk and Eli Lilly. However, recent data from early-stage trials have raised questions about Roche’s ability to compete with the established leaders in the field.
Roche, which entered the weight loss drug race through a nearly $3 billion acquisition of Carmot Therapeutics in December, has shown some early promise with its experimental obesity injection and pill. But as more data surfaces, analysts are voicing concerns about the company’s competitive edge, particularly in light of the higher-than-expected side effects observed in trials.
During a phase one trial, Roche’s oral drug CT-996, aimed at treating obesity and diabetes, demonstrated weight loss of up to 7.3% in four weeks compared to just 1.2% for the placebo group. However, this promising result was tempered by the high frequency of gastrointestinal side effects, such as nausea, vomiting, and diarrhea, which were significantly more severe than those seen in rival drugs like Novo Nordisk’s Wegovy and Eli Lilly’s orforglipron.
Jefferies analysts pointed out that Roche’s aggressive dose increases may have contributed to the higher rate of side effects, noting that “investor excitement for Roche’s obesity franchise may now take a pause.” They added that the competitive profile of Roche’s drug remains unclear until more data from larger phase two trials becomes available.
Meanwhile, JPMorgan analysts expressed even greater concern, particularly about the tolerability of the drug at its higher doses, with some patients experiencing nausea rates as high as 83%. “The tolerability of the drug under the current dosing approach looks uncompetitive,” the analysts noted in their report.
Despite the concerns, Roche’s Head of Product Development for Cardiovascular, Renal, and Metabolic, Manu Chakravarthy, remains optimistic. In a recent interview with CNBC’s Fast Money, Chakravarthy explained that the trials were designed to push the limits of the drugs in order to “fail fast” and uncover any unexpected safety or efficacy issues. He remains confident that the gastrointestinal side effects can be mitigated with slower titration in future trials.
Roche’s injection, CT-388, showed even more impressive weight loss results, helping patients shed 18.8% more weight than the placebo group over 24 weeks. The company hopes that this figure will climb to 25% in late-stage trials, giving it a chance to compete with the high efficacy seen in existing weight loss drugs.
While there is potential for Roche to carve out a piece of the booming weight loss market, the road ahead is long and uncertain. The company plans to move forward with mid-stage trials for both the pill and injection in 2025, hoping that slower titration will improve the drugs’ safety and efficacy profiles.
With the global weight loss drug market expected to be worth $150 billion by the end of the decade, all eyes will be on Roche to see if they can overcome these early hurdles and challenge the duopoly of Novo Nordisk and Eli Lilly.
