A $10 billion takeover offer from AstraZeneca (AZN.US) has been received! Obesity drug developer Rhythm (RYTM.US) shares soared in response

The Zhitong Finance App learned that according to three people familiar with the matter, AstraZeneca (AZN.US) proposed to buy obesity drug developer Rhythm Pharmaceuticals (RYTM.US) for about $10 billion. People familiar with the matter said that the price proposed by AstraZeneca in this non-binding takeover proposal reached a maximum of $134 per share, including payments linked to the achievement of milestone goals. Affected by this news, Rhythm's stock price closed up 28% to $110.68 on Wednesday.

After a period of turbulence in previous months, AstraZeneca CEO Pascal Soriot is seeking to redirect investors' attention to the company's growth prospects. The $292 billion pharmaceutical company has experienced some clinical trial setbacks, and reports that it may reach a deal with US rival Bristol-Myers Squibb (BMY.US) that could have a transformative impact are also putting pressure on its stock price.

Two people familiar with the matter said that AstraZeneca will advance the acquisition through Alexion, its rare disease business unit. AstraZeneca acquired Alexion for $39 billion in 2021 to expand beyond its core oncology and biopharmaceuticals business.

Rhythm develops treatments for rare metabolic diseases and severe obesity. Alexion, on the other hand, focuses on drugs to treat rare diseases and has become the core platform for AstraZeneca's strategy to expand the high-growth specialty drug field. Jefferies analyst Michael Leuchten said that in his opinion, AstraZeneca's strategy of finding rare disease assets “in line with its existing business layout” is completely logical. The report said that AstraZeneca has previously expressed interest in Rhythm and has restarted the acquisition of the company in recent months.

In March of this year, the US Food and Drug Administration (FDA) expanded the scope of application of Imcivree, a drug under Rhythm, to treat a rare form of obesity caused by brain injury, making this drug the first drug approved for the treatment of this disease in the US.

Michael Leuchten added: “Historically, the company can be seen as providing treatments primarily for extremely rare hereditary obesity. But approval for acquired hypothalamic obesity in March 2026... fundamentally changed this position.”

Driven by strong demand for treatments under Novo Nordisk (NVO.US) and LLY.US (LLY.US), the obesity drug market has become one of the most sought after areas in the pharmaceutical industry. The market anticipates that the sector's annual sales may exceed $100 billion over the next ten years. Although Rhythm's treatments target rare hereditary obesity rather than the broader weight loss drug market, the acquisition will allow AstraZeneca to develop a mature commercial business layout in this rapidly growing field while further expanding its rare disease product portfolio.