Monte Rosa surges premarket on Novartis collaboration deal

Investing.com -- Monte Rosa Therapeutics (NASDAQ: GLUE) shares have rallied in premarket trading on Monday, up 65.3% to $7.94 after the biotechnology company announced a new collaboration agreement with Novartis focused on developing molecular glue degraders (MGDs) for immune-mediated diseases.

The Boston-based firm said Novartis will receive an exclusive license to one undisclosed discovery target, along with options to license two additional preclinical immunology programs.

Monte Rosa will receive an upfront payment of $120 million and is eligible for option maintenance fees, development and regulatory milestones, and tiered royalties on global net sales. The total deal value could reach as much as $5.7 billion.

Chief Executive Markus Warmuth said the expanded agreement builds on the companies’ existing partnership around Monte Rosa’s VAV1 degraders, including MRT-6160, and underscores confidence in the biotech’s QuEEN platform.

“We believe this new agreement further strengthens our relationship with Novartis, a recognized global leader in immune-mediated diseases, and reflects the expansive opportunity in the space for our highly selective and potent MGDs,” Warmuth said.

Novartis also highlighted the potential of the collaboration to advance targeted protein degradation in immunology.

“This new agreement underscores our commitment to advancing targeted protein degradation as a promising approach to address immune-mediated diseases with high unmet need,” said Fiona Marshall, President of Biomedical Research at Novartis.

Monte Rosa said the cash infusion will extend its financial runway, enabling accelerated development of both partnered and wholly owned programs in areas such as Th1, Th2, and Th17-driven autoimmune conditions.

Lazard acted as the company’s exclusive financial adviser on the transaction.

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