- Eli Lilly has dropped a collaboration deal with Toronto-based Transition Therapeutics, choosing to not advance a type 2 diabetes drug into Phase 3, Transition disclosed on Monday.
- With this decision, Lilly gives worldwide development and commercialization rights back to Transition, which the pharma giant had originally acquired when it exercised its option in June 2013.
- Transition's stock dropped sharply on the news, and the company is now faced with finding a new partner or finishing late-stage development of the drug independently. The drug, a GLP-1 therapy known as TT401, has been in phase 2 development performed by Lilly.
Some back story: Transition had paid Lilly $1 million upfront in 2010 for worldwide rights to a series of preclinical diabetes compounds. Lilly subsequently exercised an option in 2013 to assume all development and commercialization rights for the drug candidate TT401 and initiated phase 2 trials on the drug.
As part of the deal, Transition paid Lilly three installment payments totaling $14 million over the course of the phase 2 study, which had enrolled 420 patients by February 2015.
Data from that study showed the high dose form of TT401 led to "significantly superior weight loss" compared to AstraZeneca's Byetta (exenatide) and a placebo after 12 and 24 weeks of treatment. In addition, it provided comparable glycemic control and reflected by HbA1C levels.
But Lilly was on the hook for all future development and commercialization costs, along with potentially $240 million in milestone payments to Transition.
In a statement, Dr. Tony Cruz, CEO of Transition, said: "We thank Lilly for their diligent development of TT401... As a leader in this new class of therapies, TT401 offers the unique opportunity of being a first-to-market product with a differentiated mechanism and activity from currently approved diabetes therapeutics."
Transition had hit a setback last June when a Alzheimer's drug failed to meet its primary endpoint. It will now face a more difficult battle for TT401 as well.
For its part, Lilly already has a full portfolio of diabetes drugs, including Synjardy (empagliflozin/metformin), which was approved last August. Synjardy is the fifth FDA approval for the Eli Lilly/Boehringer Ingelheim Diabetes Alliance.