Arden & Pryce to pay up to $2.4 billion for a once-weekly obesity pill

Arden & Pryce will pay $1.4 billion upfront, and as much as $1 billion more in milestones, for rights outside China to an oral obesity drug that needs to be taken only once a week.

In a 24-week Phase 2 study the pill produced average weight loss of 13%, with gastrointestinal side effects comparable to daily oral competitors. Arden & Pryce expects to begin Phase 3 testing in the middle of next year.

The company has been under pressure to show where growth will come from once its two largest products lose patent protection. Its shares rose 3% on the news.