New Lilly Collaboration Could Grow by Hundreds of Millions

(Image courtesy of Sigilon Therapeutics.)

Indianapolis-based Eli Lilly and Co. (NYSE: LLY) has announced a collaboration with a Massachusetts startup initially valued at more than $63 million. The partnership with Sigilon Therapeutics Inc. involves development of potential type 1 diabetes treatments through an emerging biopharmaceutical research method. In addition to an undisclosed equity investment, Lilly could also pay Sigilon up to $410 million for reaching development and commercialization targets. If a product through the partnership is created, Sigilon stands to receive "single to double digit tiered royalties" on future sales.

The collaboration involves development of encapsulated cell therapies, which target treatment of diseases like type 1 diabetes without immunosuppression. Sigilon will use an adult-derived form of stem cells called induced pluripotent stem cells to engineer treatments designed to restore insulin production, without triggering an immune reaction.

Lilly Research Labs Incoming President Daniel Skovronsky said "at Lilly, we endeavor to change the frontiers of what’s possible in medicine, both through our own scientific labs and in collaboration with other leading researchers. We are excited to be collaborating with, and investing in, Sigilon as they seek to develop encapsulated cell therapies, a potentially disruptive technology that could result in meaningful clinical advancements for chronic diseases such as type 1 diabetes."

Terms of the agreement call for Sigilon to take charge of all development activities and costs until an investigational new drug application is submitted. If the IND submission takes place, Lilly would take responsibility for clinical development, commercialization and costs.

Sigilon was launched by life science innovation firm Flagship Pioneering for $23.5 million in 2017. You can connect to more about the collaboration by clicking here.