LG Chem said Friday it has signed an agreement with Boston-based Rhythm Pharmaceuticals to transfer the development and sales rights of a new anti-obesity drug candidate named LB54640.

The deal amounts to $305 million, which includes upfront payments worth $100 million and milestone payments worth $205 million for the development and commercialization of the drug.

Under the agreement, LG Chem will receive royalties depending on product sales from Rhythm Pharmaceuticals each year.

Rare forms of obesity can be caused by genetic defects. For instance, defects in the pathway of the satiety signaling gene MC4R, or melanocortin-4 receptor, can cause abnormalities in appetite control, which leads to persistent and severe obesity.

LB54640 is an orally-administered MC4R agonist, and its phase 1 trial results confirmed a dose-dependent trend in weight loss, as well as safety.

The drug entered the phase two clinical trial in the US in October, and Rhythm Pharmaceuticals plans to take over the study.

Rhythm Pharmaceuticals, founded in 2010, has developed and commercialized Imcivree, the first FDA-approved MC4R agonist.

“Rhythm Pharmaceuticals is the right company for the successful development of LB54640,” said Son Jee-woong, head of LG Chem’s life sciences division.

“LG Chem will fully cooperate to bring safer and more effective new drugs to patients around the world suffering from rare (forms of) obesity.”

“We confirmed the potential for developing a new drug with a high level of safety based on LG Chem’s phase 1 results of LB54640,” said Rhythm Pharmaceuticals CEO David Meeker.

"We look forward to expanding our rare obesity drug portfolio to provide patients with optimal treatment options."