Roche will pay $7.1 billion to acquire Telavant Holdings, which is at the forefront of developing promising therapies for inflammatory bowel disease. The strategic move is aimed at strengthening Roche's drug portfolio.

The antibody treatment developed by Telavant under the name RVT-3101 targets both inflammation and fibrosis, giving it potential for use in many other diseases. Inflammatory bowel disease affects nearly 8 million people worldwide, with 80% of them struggling to find a long-term solution. In the United States alone, the market for inflammatory bowel disease treatments is expected to reach a potential of US$15 billion.

The drug RVT-3101 belongs to a class of novel therapies known as anti-TL1A antibodies that attract high M&A activity. This month, for example, Sanofi secured the rights to Teva's anti-TL1A antibody for up to $1 billion, and in April, Merck & Co also entered the field, acquiring Prometheus Biosciences for $10.8 billion.

The acquisition represents Roche's largest transaction since its $8.3 billion purchase of InterMune in 2014 and comes shortly after Roche released its latest earnings report. In it, the company reported a decline in sales of COVID-19-related products, but posted a 1% year-on-year increase in group sales.