- Eli Lilly is making a bet on radiopharmaceutical drugs for cancer, announcing Tuesday a deal to buy Point Biopharma and its pipeline of experimental therapies for approximately $1.4 billion.
- Per acquisition terms, Lilly will pay $12.50 per Point share, a premium of about 87% to what the biotechnology company’s stock closed at Monday. The companies expect their deal to close “near the end” of this year.
- Based in Lilly’s home base of Indianapolis, Point specializes in radiopharmaceuticals, which pair a radioisotope with a targeting compound that delivers radiation directly into tumor cells. Recent improvements in manufacturing and supplying the complex treatments have boosted investment in the field, drawing interest from large pharma companies like Lilly as well as new drug startups.
The Point deal appears to be part of a broader plan by Lilly to build a presence in radiopharma drug development.
Jacob Van Naarden, who runs Lilly’s oncology unit, described the acquisition as the “beginning” of his company’s investment in developing “multiple meaningful radioligand medicines for hard-to-treat cancers.”
“Over the past few years, we have seen how well-designed radiopharmaceuticals can demonstrate meaningful results for patients with cancer and rapidly integrate into standards of care, yet the field remains in the early days of the impact it may ultimately deliver,” he said in Lilly’s Oct. 3 statement.
Acquiring Point will give Lilly three clinical-stage drugs, two of which are potential competitors to approved radiopharma therapies sold by Novartis. Results from a Phase 3 trial of the first, a treatment for metastatic castration-resistant prostate cancer, is expected this quarter. The drug is similar in construction to Novartis’ Pluvicto, and analysts are expecting the data to show a roughly comparable benefit.
Point has licensed rights to those two therapies to Lantheus Holdings, however. Evercore ISI analyst Umer Raffat therefore sees Lilly’s interest in Point as tied to the biotech’s earlier-stage drugs, which are aimed at newer therapeutic targets and use a different radioisotope, actinium, to kill cancer cells.
“Recent interest in radiopharma has coalesced around ‘alpha emitters,’ especially actinium,” he wrote in a note to clients. He added that the isotope is potentially safer to administer and more potent than previously used isotopes.
Yet radiopharma drugs are complex to produce and supply, requiring specialized partners and just-in-time delivery to treatment centers. These challenges held back the field’s expansion until recently, as private sector isotope suppliers have emerged and companies have gotten better at constructing the therapies.
Buying Point gives Lilly an 180,000-square-foot factory in Indianapolis, as well as an research and development center in Toronto.
Novartis’ commercial success with Pluvicto and its other approved radiopharma drug Lutathera has been another important proof point. Sales of the two drugs are now annualizing at about $1.6 billion combined, showing a path to investment returns.
Along with Novartis, Bayer, AstraZeneca, Merck & Co. and Roche have also made investments in radiopharma drug development, mostly via biotech partnerships. (Bloomberg reported Tuesday that Novartis is weighing selling some diagnostic imaging assets currently housed in its radiopharma unit.)
“Overall, we see the deal as a positive for [Point] specifically and the radiopharmaceutical space as a whole,” wrote Faisal Khurshid, an analyst at Leerink Partners, in a client note Tuesday.
For Lilly, the acquisition adds to a string of small-scale dealmaking. The company, which has soared to a $500 billion market capitalization on the promise of its obesity and Alzheimer’s drugs, has bought private companies Versanis and Emergence this year, as well as the publicly traded Sigilon Therapeutics and Dice Therapeutics.