Better late than never: Lilly joins immuno-oncology chase

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As the immuno-oncology train pulls away from the station, Eli Lilly is jumping aboard with a $60m deal to develop T cell-focused cancer therapies.

The collaboration with private German developer BioNTech gives Lilly access to a technology for cloning T cells that can be directed against tumours, an approach now on the cutting edge of oncology development. In danger of dropping out of the top 10 cancer companies with a portfolio of chemotherapies, kinase inhibitors and antibodies, the Indianapolis-based developer is attempting to catch up with Novartis, Pfizer and Merck KGaA.

Falling back, catching up

Lilly is paying $30m upfront and investing $30m in BioNTech’s Cell & Gene Therapies subsidiary, which specialises in the development of T cell receptor and chimeric antigen receptor (CAR) immunotherapies. For each project designated for development in the collaboration, BioNTech would be eligible for $300m in milestones and royalties, although a maximum number of candidates has not been specified.

Once a secure mid-pack competitor in the oncology space, Lilly has dropped back as revenue from products like Gemzar, Erbitux and Alimta has hit its peak, while its laboratories only managed to produce a replacement product in Cyramza starting last year.

Its oncology portfolio is a bit of yesterday’s news: Alimta is simply chemotherapy; Cyramza, while an antibody, hits the vascular endothelial growth factor target pioneered by Avastin more than a decade ago; and pipeline project ademaciclib is a kinase inhibitor using the same relatively novel mechanism of action as Pfizer’s Ibrance.

Thus Lilly putting an ante to enter the immuno-oncology game is yet another sign that companies cannot ignore this space if they want to have a presence in cancer care - it entered the checkpoint inhibitor game very late when it signed up with Bristol-Myers Squibb to test Opdivo with kinase inhibitor galunisertib. Interesting assets are gradually being snapped up by the big players, and the bidding may only become more intense.

The Lilly upfront has set a benchmark for fellow German group Medigene, which as a company that has gradually evolved into an immuno-oncology play has seen its share prices double in the past 12 months (Medigene seesaws with biotech as immuno-oncology strategy matures, March 26, 2015).  Certainly Medigene’s investors must now be hoping that the base price for any collaboration would be in the $60m range and the price for a takeout well above its current €146m ($165m) market capitalisation.

Immuno-oncology shake-out?

BioNTech has been backed primarily by investment from the Strüngmann family, which made its fortune on the sale of generics company Hexal to Novartis.

It already has clinical stage assets in the form of messenger RNA therapeutics. The Lilly collaboration should kick-start its UniCell human adoptive T cell receptor agents, at the epicentre of what may be the next wave of cancer immunotherapies.

The company says the UniCell platform can deliver cloned T cells directed toward antigens specific to tumour cells in as little as 11 days. It says it has compiled a library of T cell receptor drug candidates, although it is not clear whether the Lilly collaboration will involve new discovery or existing BioNTech targets.

Now that the excitement of T cell directed therapies has established itself, the shake-out of the best candidates is underway. The shape of licensing deals should help identify the big pharma groups that feel they need to shore up their oncology portfolio as well as which developers have the best offerings.  Lilly made clear it is willing to pay to play in immuno-oncology – others surely are close behind.

To contact the writer of this story email Jonathan Gardner in London at jonathang@epvantage.com or follow @JonEPVantage on Twitter

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