NEW YORK, Aug. 23 – Eli Lilly and Co. said it plans to acquire a 9 percent stake in Isis Pharmaceuticals in a $200 million, four-year deal in which it will license an antisense cancer compound being developed by Isis, and collaborate to use Isis' antisense technology to discover new drugs, the companies said.
Under the terms of the partnership, Lilly will pay $75 million, or $18 a share, for its stake in Isis, as well as $25 million to license ISIS 3521, the company’s promising antisense candidate for lung cancer.
The Indianapolis-based pharmaceutical company will also loan Isis $100 million, which Isis will have to repay in either cash or stock over four years.
The four-year alliance, announced on Wednesday, calls for Lilly and Isis to discover antisense drugs for a variety of metabolic and inflammatory disease, the companies said. The firms plan to use Isis’ GeneTrove technology to uncover the role of some 1,000 human genes in various disease states.
“We…are keenly interested in antisense technology as both a novel class of highly selective drugs and as a tool to leverage genomics and accelerate target validation in support of our diverse drug discovery programs,” August Watanabe, Lilly’s executive vice president of science and technology, said in a statement.
Stanley Crooke, Isis’ chairman and CEO, added: “The formation of this strategic partnership with Lilly is a pivotal event for Isis. This transaction…enables us to intensify our drug discovery, drug development and technology efforts.”
The deal “will help us establish antisense technology as an important new class of drugs,” Crooke said.
Under the agreement, Lilly gains marketing rights to future drugs based on Isis's antisense technology. Lilly will also reimburse Isis for remaining development and registration costs for ISIS 3521, which is in phase III trials. Isis may also receive about $50 million in milestone payments plus royalties on product sales.
The deal with Lilly and Isis is the latest antisense licensing agreement to be announced this week. Also on Wednesday, functional genomics company Sequitur licensed its own antisense technology to Rigel Pharmaceuticals.
That multi-year agreement calls for Sequitur, based in Natick, Mass., to provide Rigel with antisense compounds and methods for selecting and transfecting DNA sequences. In return, Rigel, based in South San Francisco, Calif., will pay research support, charges for antisense compounds, and licensing fees.