LG Chem said Friday that it has signed an agreement with Rhythm Pharmaceuticals to transfer the global development and commercialization rights of LB54640, a monogenic obesity treatment.

The total value of the deal is $350 million, with an upfront payment of $100 million, development and commercialization milestones of up to $250 million, and annual royalties based on Rhythm Pharmaceuticals' annual sales.

Monogenic obesity is a rare disorder in which certain genetic defects, such as the melanocortin-4 receptor (MC4R), cause abnormalities in appetite control, resulting in severe obesity and difficulty living a normal social life, and symptoms usually appear in childhood.

Rhythm Pharmaceuticals was founded in Boston, U.S. in 2010, listed on the Nasdaq in 2017, and has successfully developed and commercialized Imcivree (setmelanotide) injection, an MC4R agonist.

LB54640 is an orally administered MC4R agonist that has shown efficacy and safety in a phase 1 clinical trial. Based on this, it entered a phase 2 study in the U.S. in Oct. 2023 for patients with monogenic obesity.

Patient recruitment is one of the biggest challenges in clinical trials for orphan drugs due to the small number of patients, and LG Chem believes that partnering with Rhythm Pharmaceuticals, which has invested significant resources in identifying potential patients, will enable more efficient drug development.

Through this partnership with Rhythm Pharmaceuticals, LG Chem expects to accelerate the development of LB54640 and bring a more convenient treatment to patients sooner.

"Rhythm Pharmaceuticals is the right partner for the successful development of LB54640," said Son Jee-woong, President of Life Sciences Company at LG Chem. "Through active collaboration, we will bring safer and more effective new medicines to patients suffering from monogenic obesity worldwide promptly."

"LG Chem's phase 1 results with LB54640 confirmed the potential for developing a novel drug with a high level of safety," said David Meeker, CEO and President of Rhythm Pharmaceuticals. "We look forward to expanding our monogenic obesity drug portfolio to provide patients with optimal treatment options."