Indianapolis-based Eli Lilly is betting big on clinical-stage oncology company Merus, agreeing to pay up to $1.6 billion to the Netherlands-based biotech for a research and development collaboration focused on up to three early experimental cancer drugs.
Michael Vi/Shutterstock
Indianapolis-based Eli Lilly is betting big on clinical-stage oncology company Merus, agreeing to pay up to $1.6 billion to the Netherlands-based biotech for a research and development collaboration focused on up to three early experimental cancer drugs.
The partnership will see Eli Lilly’s Loxo Oncology unit, which was sold to Eli Lilly for approximately $8 billion in 2019, leveraging Merus’ proprietary Biclonics® platform to research and develop no more than three CD3-engaging T-cell re-directing bispecific antibody therapies. Loxo Oncology’s Chief Operating Officer, Jacob Van Naarden, said the therapies “are rapidly becoming one of the most transformative immune-modulating modalities used” in the treatment of cancer.
“We expect these therapies will become an important component of the Loxo Oncology at Lilly biologics strategy,” said Van Naarden in a statement. “Merus has built a differentiated platform and one that we believe can enable us to create bispecific antibody therapies with wider therapeutic indexes than those available today. We look forward to working closely with Merus to develop new potential medicines for patients with cancer.”
Under terms of the collaborative agreement, Eli Lilly will provide Merus an upfront cash payment of $40 million. In addition, Merus will receive an equity investment of approximately $20 million in common shares. Netherlands-based Merus will also be eligible for as much as $540 million per candidate, which will be contingent on achievement of development and commercial goals.
“The collaboration with Loxo Oncology at Lilly and their world class research capabilities opens up exciting possibilities for Merus’ Biclonics® platform,” according to a statement made by Bill Lundberg, MD., Merus’ President and Chief Executive Officer.
Merus’ Biclonics platform comprises over 175 antibodies that bind to T-cell protein CD3. This binding helps activate immune cells. “Our CD3 T-cell engager platform includes over 175 novel and diverse anti-CD3 common light chain antibodies across a wide range of affinities and attributes and enables functional screening of large libraries for optimal performance,” added Lundberg. “We look forward to working together with Loxo Oncology at Lilly to define a new generation of medicines to treat cancer.”
The agreement allows Merus to continue developing its T-cell antibody candidates in early research phases. Lilly will become involve in the research and development process for these candidates once they move into preclinical and clinical stages.
Eli Lilly has been on a roll in putting down big bucks for partnerships and acquisitions. In December 2020, Lilly acquired Prevail Therapeutics for $1.04 billion, which will let Eli Lilly gain access to the company’s treatments for Parkinson’s disease and other neurodegenerative diseases. The lead gene therapies in clinical development from Prevail at time of the acquisition included PR001 for Parkinson’s disease with GBA1 mutations and neuronopathic Gaucher disease as well as PR006 for frontotemporal dementia with GRN mutations. PR001 was given Orphan Drug designation and Rare Pediatric Disease designation by the U.S. Food and Drug Administration in February 2020 as a potential gene treatment for Gaucher disease and neuronopathic Gaucher disease, respectively. Announcement of the deal with Eli Lilly led to Prevail’s stock nearly doubling to $23 per share.
And in mid-January of this year, Eli Lilly also announced a $30 million limited partner investment in newly formed venture fund Unseen Capital Health Fund. The fund was created by a “racially diverse and historically underrepresented business leaders that is intended to identify, fund and support underrepresented founders of early-stage healthcare companies and those building solutions for marginalized communities,” according to a statement.
