Lilly Opens Its Wallet For Early Immunology Tie-Up With ImmuNext
Executive Summary
Lilly is prepared to splash over $600m on an early development deal with ImmuNext on an immunometabolism target which ties the companies together for three years while an antibody is being developed.
Eli Lilly & Co. is bolstering its immunology portfolio through a deal with established pharma partner ImmuNext Inc. that deal pivots around a preclinical novel target the companies believe could lead to new treatments for autoimmune diseases by regulating immune cell metabolism.
Target validation studies have revealed the target operates independently and upstream of known immune checkpoint regulators, which brings an opportunity for the treatment of indications with limited options.
Lilly will pay ImmuNext $40m up front, with scope for a further $565m in development and commercialization milestones, as well as tiered royalties ranging from the mid-single to low-double digits on product sales. There will be no change to Lilly's 2019 earnings per share guidance as a result of the transaction.
ImmuNext will grant Lilly an exclusive, worldwide license to develop and commercialize the novel immunometabolism target. In addition, Lilly and ImmuNext will establish a three-year research collaboration to support the target's development.
Jay Rothstein, chief scientific officer at ImmuNext, said that the deal with Lilly would “bring forward a first-in-pathway antibody that specifically targets the metabolism of lymphocytes to reprogram rather than suppress the immune system.”
Early Phase Promises
Lilly is making good on its promises to look for deals that involve higher-risk early-stage molecules and new modalities. At Lilly’s investor briefing in December 2018, chief scientific officer Dan Skovronsky told of the new appetite for preclinical and early phase assets (see sidebar).
“You'll see us engaging more and more on some of these target space deals,” Skovronsky said. “That's new for us, but the goal is to have more first-in-class medicines, and that's the way we're going to do it.”
The company has eight Phase I immunology assets in development, two in Phase II (baricitinb for alopecia areata and mirikizumab for Crohn’s disease). In Phase III it is studying its JAK1/JAK2 inhibitor baricitinib for atopic dermatitis and systemic lupus erythematosus, its IL-17 ixekizumab for non-radiographic axial spondyloarthritis, and IL-23 antibody mirikizumab for psoriasis.
“Immunology is an important area of research for Lilly, and we seek novel targets that could develop into new medicines for patients suffering with autoimmune diseases,” said Ajay Nirula, vice president of immunology at Lilly. "Regulating the metabolism of immune cells is a promising approach to treating these diseases, and we look forward to working with ImmuNext to advance their immunometabolism target."
Industry Interest
New Hampshire-based ImmuNext has become a staple discovery partner for the industry. Its anti-CD40L antibody was licensed by Sanofi in January 2017 for potential development in lupus and multiple sclerosis. It is thought the deal could earn ImmuNext up to $500m in milestones alongside tiered royalties if the antibody reaches the market.
In 2016, it inked a $400m deal with Roche that granted the Swiss major an exclusive license to develop and commercialize therapeutics that agonize the V-region immunoglobulin-containing suppressor of T-cell activation (VISTA) signalling pathway. VISTA is a negative checkpoint regulator.
And in 2012, it signed a $150m agreement with Janssen Biotech Inc. that focused on the development of novel therapeutics that modulate the immune system for the treatment of cancer.
Investors have also been looking with interest at the immunometabolism space for new and interesting companies developing therapies based on this approach.
In October 2018, Sitryx Therapeutics, a start-up backed by GlaxoSmithKline PLC among others, completed series A funding of $30m, and launched with six early-stage projects to target immunometabolic pathways with small-molecule candidates. (Also see "GSK-Backed Sitryx Launches With Six Immunometabolism Eggs In Its Basket " - Scrip, 8 Oct, 2018.)
In April 2018, [Rheos Medicines Inc.] was launched with $30m in series A funding from venture capital firm Third Rock Ventures. The company wants to concurrently identify new targets and biomarkers, thus enabling a precision medicine approach for treating immune-mediated disorders. It has two preclinical programs: the first targets the CD4 T cell for treating inflammatory bowel disease, lupus and psoriasis; and the second targets CD8 as a potential treatment for autoimmune thyroiditis, immuno-oncology indications and vitiligo.
Lilly has paid to play catch up with the rest of industry in immuno-oncology. At the beginning of the year it spent $8bn on Loxo Oncology Inc., paying $235 per share in cash, a premium of 68% to the latter's closing stock price on Jan. 4. (Also see "Lift-Off For Lilly In Cancer Genetics With Loxo Buy" - Scrip, 7 Jan, 2019.) And eight months previous to that, its $1.6bn buy of Armo BioSciences Inc. brought the company its most advanced IO asset – the pegylated Interleukin-10 (IL-10) known as pegilodecakin, a next-generation IO drug that may work well alone and in combination with first-generation immunotherapies. (Also see "$1.6bn ARMO Buy Gives Lilly Its Most Advanced Immuno-Oncology Asset" - Scrip, 10 May, 2018.)