Roche entered into a definitive merger agreement to acquire 89bio, a publicly listed clinical-stage company pioneering the development of 89bio’s pegozafermin for the treatment of moderate to severe MASH (Metabolic Dysfunction-Associated Steatohepatitis).

With 89bio’s pegozafermin, Roche aims to address metabolic dysfunction-associated steatohepatitis (MASH), one of the most prevalent comorbidities of obesity besides type 2 diabetes.

This acquisition reaffirms our commitment to advancing therapy options in cardiovascular, renal, and metabolic (CVRM) diseases, addressing critical patient needs and high disease burden, as science gives us an opportunity to evolve the standard of care.

MASH, which stands for Metabolic Dysfunction-Associated Steatohepatitis, is a severe form of liver disease that is becoming increasingly prevalent worldwide. This is largely driven by the global rise in obesity and type 2 diabetes, as most (>75%) of MASH patients also live with overweight, obesity and/or type 2 diabetes. Today, MASH is estimated to affect about 5 - 7% of the world’s adult population.

Pegozafermin is an FGF21 (Fibroblast Growth Factor 21) analog with a distinct mode of action and a favourable safety profile for MASH, designed to balance efficacy and a long dosing interval. With its combined anti-fibrotic and anti-inflammatory mechanism, pegozafermin shows the potential to become a transformative therapy option offering best-in-disease efficacy and tolerability for moderate to severe MASH patients (F2/F3/F4).

Based on available clinical data, we see the potential for pegozafermin to be a best-in-disease FGF21 monotherapy while also expanding into combination therapies (e.g., with GLP-1 analogs), thus creating synergies with Roche’s CVRM portfolio.

Acquiring 89bio, with its pegozafermin currently in Phase 3, offers a strong strategic fit with Roche’s CVRM therapeutic area and overall strategy. The addition of 89bio’s pegozafermin will support the expansion of our robust portfolio in CVRM into MASH while offering optionality for future combination development, creating synergies with Roche’s CVRM portfolio.

Our ambition is to complement and strengthen our existing CVRM portfolio programs, aiming to address the critical challenges of highly prevalent obesity-related comorbidities such as MASH, across moderate to severe disease stages by tapping into the potential of this FGF21 analog.

What is the rationale for this acquisition?

Roche entered into a definitive merger agreement to acquire 89bio, a publicly listed clinical-stage company pioneering the development of 89bio’s pegozafermin for the treatment of moderate to severe MASH (Metabolic Dysfunction-Associated Steatohepatitis).

With this transaction, Roche reinforces its commitment to patients with cardiovascular, renal, and metabolic (CVRM) diseases, driving further advancements in addressing critical unmet patient needs in overweight, obesity, and related comorbidities.

With pegozafermin, Roche aims to tap into the full potential of this FGF21 analog to address MASH as one of the most prevalent comorbidities of obesity besides type 2 diabetes.

What is the scope of this agreement?

What are the financial terms of the agreement?

US$2.00 per share in cash, upon the first commercial sale of pegozafermin in F4 MASH cirrhotic patients (by March 31, 2030)

US$1.50 per share in cash, upon pegozafermin reaching annual net sales globally of at least US$3.0 billion in any calendar year (by December 31, 2033)

US$2.50 per share in cash, upon pegozafermin reaching annual net sales globally of at least US$4.0 billion in any calendar year (by December 31, 2035)

What is the potential you see in this deal?

MASH, which stands for Metabolic Dysfunction-Associated Steatohepatitis, is a form of liver disease that is becoming increasingly prevalent worldwide, largely driven by the global rise in obesity and type 2 diabetes as most (>75%) of MASH patients also live with overweight, obesity and/or type 2 diabetes as comorbidities. Today, MASH is estimated to affect about 5 - 7% of the world’s adult population.

Pegozafermin is an FGF21 (Fibroblast Growth Factor 21) analog with a distinct mode of action engineered to balance efficacy and a twice-monthly dosing interval. With its promising combined anti-fibrotic and anti-inflammatory mechanism associated with a favourable safety profile, Pegozafermin shows the potential to become a transformative therapy option offering best-in-disease efficacy and tolerability for patients with F2-F4 MASH.

Acquiring 89bio, with its pegozafermin currently in Phase 3, supports Roche’s strategy as it enhances our portfolio in cardiovascular, renal, and metabolic diseases (CVRM) and offers optionality for future combination development creating synergies with Roche’s current CVRM portfolio

Did Roche shareholders have to vote for this, as it represents a significant investment?

Who are the transaction financial advisors?

Citi is acting as exclusive financial advisor to Roche, and Sidley Austin LLP is acting as legal counsel to Roche.

Please describe the details of the transaction. What are the conditions for a public tender offer in the United States? What are the timelines?

The closing of the tender offer will be subject to a majority of 89bio’s outstanding shares being tendered in the tender offer and other customary closing conditions for a transaction of this nature. Promptly following completion of the tender offer, Roche will acquire all remaining shares at the same price per share through a second-step merger.

Furthermore, the transaction is subject to the expiration or termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 and other customary closing conditions.

The closing of the transaction is expected to take place in the fourth quarter 2025.

When do you expect the transaction to close? Do you expect any prolonged regulatory reviews?

What conditions need to be met for this transaction to be completed?

Will you increase your price? Are you aware of other bidders for 89bio?

Why did you include a significant CVR component given the upfront premium?

How long do you expect the tender offer to last? By when shall it be concluded?

Will a squeeze-out follow the public takeover offer? How many shares need to be in Roche’s possession for a squeeze-out to happen?

Will this transaction be core EPS dilutive?

Regarding any questions on, e.g., IRR, ROI, peak sales, additional interest expense due to financing, etc.?

How does this acquisition fit into Roche’s CVRM strategy?

Acquiring 89bio, with its pegozafermin currently in Phase 3, offers a strong strategic fit with our CVRM therapeutic area and overall strategy. The addition of pegozafermin will enhance our robust CVRM pipeline and support the acceleration of our key assets, while delivering synergies with our prioritized indications, obesity, and IBD.

Our ambition is to complement and strengthen our existing CVRM portfolio programs, aiming to address the critical challenges of highly prevalent obesity-related comorbidities such as MASH, across moderate to severe disease stages by tapping into the potential of this FGF21 analog.

How does this collaboration fit into Roche’s overall corporate business development strategy?

We continue to strengthen our pipeline by bringing in external innovation focused on the therapeutic areas defined in our Pharma Strategy with the ultimate goal to deliver transformative medicines for patients.

Following our deal with Alnylam and the acquisition of Carmot, as well as our recently signed collaboration with Zealand Pharma, this acquisition demonstrates a continuation of our strategic investment in cardiovascular and metabolic (CVRM) diseases.

What is the overall market opportunity you see in MASH?

Metabolic Dysfunction-Associated Steatohepatitis (MASH) is a form of liver disease that is becoming increasingly prevalent worldwide, largely driven by the global rise in obesity and type 2 diabetes, as most (>75%) of MASH patients also live with overweight, obesity, and/or type 2 diabetes as comorbidities. Today, MASH is estimated to affect about 5—7% of the world’s adult population, and based on this, it can be seen as a global metabolic health epidemic at an inflection point with the first and only approved treatment in 2024.

In 2024, the global MASH treatment market size was estimated to be around $2.47 billion, and some experts expect this to increase to $10 to $30 billion by the 2030s.

Should we expect more deals in the obesity space from Roche?

Following our previous deal with Alnylam and the acquisition of Carmot, as well as our recently signed collaboration with Zealand Pharma, this announcement underlines the continuation of our strategic investment to foster our presence in cardiovascular and metabolic (CVRM) diseases.

The acquisition of 89bio allows us to build a competitive portfolio with an FGF21 analog that offers a differentiated mode of action with a promising safety and tolerability profile for patients with moderate to severe MASH.

However, a high unmet need remains in CVRM, and we continue to explore new options, both through external opportunities and in-house programs to bring transformative therapy solutions to patients in need.

This sector requires significant development investments from Roche. Will you have to make any trade-offs with other areas of the portfolio for this?

Who do you see as key competitors?

We do not comment on our competitors. With the current availability of treatment options, a high unmet need still exists. We strongly believe that pegozafermin can have a significant impact in addressing that need.

We also see opportunities for combinations with our existing assets (e.g., with our GLP1-analog) to treat obesity and its comorbidities.

What is your manufacturing strategy for the product, particularly in relation to the BiBo collaboration?

We will evaluate our manufacturing strategy holistically following the closing of the transaction. Overall, our manufacturing strategy is to ensure uninterrupted Ph3 clinical supply, registration enabling qualifications, and successful registration, launch, and commercial supply by working with 89bio’s CDMOs such as BTPH, BiBo, and INCOG.

Who is 89bio?

Founded in 2018, 89bio is a clinical-stage biopharmaceutical company focused on the development of innovative therapies for the treatment of liver and cardio-metabolic diseases. 89bio’s pegozafermin is being developed for the treatment of MASH. Pegozafermin is a specifically engineered glycoPEGylated analog of FGF21. 89bio is headquartered in San Francisco.

What is pegozafermin, and what is its benefit?

89bio’s investigational asset pegozafermin is an FGF21 analog currently in Phase 3, is a protein that mimics the function of a natural hormone in the body. Through the application of glycoPEGylation technology, this molecule has been engineered to last longer in the body while addressing the underlying metabolic causes of liver and heart-related conditions, including moderate to severe MASH (F2/F3 and F4).

The asset was initially developed by Teva Pharmaceutical Industries, but is now being developed by 89bio after Teva transferred the related intellectual property in 2018.

Acting essentially as a metabolic regulator, 89bio’s pegozafermin tackles MASH from several angles. It helps reduce liver fat, lessen inflammation, and improve liver scarring (fibrosis)—a key driver of severe MASH. It also boosts insulin sensitivity and lowers harmful fats.

In the ENLIVEN Phase 2b trial, it showed positive results for MASH resolution and fibrosis improvement, even suggesting the potential to prevent progression to cirrhosis. So far, it has demonstrated a favourable safety and tolerability profile, which is vital for long-term treatment.

How does pegozafermin differentiate from other therapies in this space, specifically resmetirom?

What is the patient population that can benefit from this asset?

Pegozafermin is being developed to treat patients with Metabolic Dysfunction-Associated Steatohepatitis (MASH) who also have liver fibrosis. Specifically, its ongoing Phase 3 clinical trial program (ENLIGHTEN) is targeting two distinct patient populations:

Non-cirrhotic MASH patients with fibrosis (F2-F3): These are individuals whose MASH has progressed to cause notable scarring of the liver, but it has not yet reached cirrhosis. This group is at high risk for progressing to more severe liver disease.

MASH patients with compensated cirrhosis (F4): This is a more advanced patient population where the liver has significant scarring (cirrhosis) but is still able to function adequately. Treating MASH at this stage to achieve fibrosis regression is particularly challenging, and pegozafermin is notable for being one of the first FGF21 analogs to enter Phase 3 trials for this specific group.

What potential combinations are there for pegozafermin?

There is clinical data available showing pegozafermin could be used in SHTG treatment. Do you have plans to proceed with this as well?

How big do you estimate the total addressable market for your obesity portfolio to be? And for MASH?

Some analysts estimate the obesity market to become as large as $100 billion annually by the 2030s, and the market linked to comorbidities could be more extensive. Thus, we firmly believe that multiple therapy options will be needed to address the growing needs worldwide.

The total addressable market for MASH is projected to be substantial, driven by the high and rising global prevalence of the disease, particularly as it’s linked to the epidemics of obesity and type 2 diabetes. In 2024, the global MASH treatment market size was estimated to be around $2.47 billion, and some experts expect this to increase to $10—30 billion by the 2030s.

Offering a new therapy option for the treatment of moderate to severe MASH holds the potential to create significant value for healthcare systems, since MASH and MASH-related cirrhosis are seen as the main drivers for liver transplantations over the next 5—10 years.

Given the current entry of incretins (e.g. semaglutide approval) in the MASH space, how do you see pegozafermin differentiating from incretins, and what concerns, if any, do you have around incretins shrinking the addressable MASH patient population?

Incretins and pegozafermin differ in their mechanism of action as incretins mainly promote weight loss by mimicking the effects of natural hormones like GLP-1 and enhance glucose control. Pegozafermin, on the other hand, is a Fibroblast Growth Factor 21 (FGF21) analog with a combined anti-inflammatory and anti-fibrotic mechanism of action and insulin sensitizer. Insulin resistance is a sine qua non of MASH pathogenesis, and therefore, an insulin sensitizer is critical to address this pathophysiology.

While incretins address MASH by tackling its underlying metabolic drivers such as type 2 diabetes (T2DM) and obesity through systemic weight loss – i.e. essentially as a secondary effect and less so as a direct antifibrotic, pegozafermin focuses on treating MASH itself, especially with its fibroinflammatory effects while also directly addressing insulin resistance. Thus, pegozafermin tackles MASH from several angles: reduce liver fat, lessen inflammation, and improve liver scarring (fibrosis)—a key driver of severe MASH and poor outcomes

The most important differentiator for pegozafermin is that lean mass is not affected by FGF21 whereas incretins will lead to more lean mass loss (can be up to 40% lean mass loss). Lean mass loss is a major issue in people with cirrhosis, and loss of lean mass directly correlates with worse outcomes; thus, we do not want more lean mass loss in those who already have sarcopenia

What is the expected peak sales for the asset?

What kind of data is available for 89bio’s pegozafermin?

Phase 2b ENLIVEN Trial

Are there studies ongoing for 89bio’s pegozafermin?

Yes, 89bio is currently running the Phase 3 ENLIGHTEN clinical trial program for its investigational therapy, pegozafermin, which comprises two pivotal randomized, double-blind, placebo-controlled studies using co-primary endpoints that assess MASH resolution or fibrosis improvement without worsening of the other condition.

The ENLIGHTEN-Fibrosis trial targets non-cirrhotic MASH patients (fibrosis stages F2/F3). It aims to assess the efficacy and safety of pegozafermin (30mg weekly or 44mg biweekly) versus placebo, focusing on assessing the endpoints fibrosis improvement and MASH resolution at week 52, with approximately 1,050 adult patients (age 18-80) globally. First topline results are expected in H1 2027.

The ENLIGHTEN-Cirrhosis trial focuses on MASH patients with compensated cirrhosis (F4 fibrosis), evaluating pegozafermin in this advanced group with an expected enrollment of 760 adult patients (18-80). Notably, pegozafermin is the first FGF21 analog to reach Phase 3 trials for MASH patients with compensated cirrhosis, underscoring its potential in addressing urgent needs in liver disease. First results are expected in 2028.

When do you foresee launching this asset?

How does this acquisition complement your existing portfolio? Aren’t you going too broad in your portfolio with so many different assets?

Acquiring 89bio, with its pegozafermin currently in Phase 3, offers a strong strategic fit with our CVRM therapeutic area and overall Pharma strategy. Pegozafermin offers a distinct mechanism of action that not only holds the potential for best-in-disease efficacy and tolerability to address the critical challenges of highly prevalent obesity-related comorbidities such as MASH. It also unlocks opportunities for future combination development, creating synergies with Roche’s CVRM portfolio and our prioritized indications, obesity and IBD.

Looking at our portfolio, it is set up for broad optionality, recognizing the heterogeneity of the patient population while catering to the diverse therapy needs. It is designed to offer holistic solutions centered around currently unmet patient needs.

Do you believe the SC or oral administration will prevail in the obesity market in the years to come?

Which other clinical stage assets in your CVRM portfolio are you considering for combination therapies?

The combination of CT-388 and petrelintide potentially offers best-in-disease efficacy for weight loss, weight management, glycemic control, and end-organ protection while providing good tolerability. Both petrelintide and CT-388 are currently in Phase 2 studies, and we will need to review the results of these studies before we can share very specific details and timelines for a Phase 2 combo trial initiation.

CT-388 + GYM-329 could help to preserve muscle mass, which is lost in patients on incretin therapy.

A Phase II trial investigating GYM329 in combination with an approved incretin in patients living with obesity, without T2D, has started this year.

Based on available clinical data, we see the potential for pegozafermin to be a best-in-disease FGF21 monotherapy while also expanding into combination therapies with e.g. GLP-1 analogs, thus creating synergies with Roche’s CVRM portfolio.