- Eli Lilly has agreed to pay $125 million for an exclusive license to an experimental drug from Rigel Pharmaceuticals that the companies believe could be valuable in the treatment of autoimmune and inflammatory diseases.
- Called R552, the drug is supposed to block an enzyme that plays a role in a wide range of cellular processes, including inflammation and cell death. R552 recently completed early-stage testing, and is set to begin mid-stage clinical trials this year as part of the collaboration. In addition to the upfront cash, Rigel is eligible to receive as much as $835 million in milestone payments, plus tiered royalties that would vary depending on its clinical development investment.
- Rigel also has a slate of preclinical drugs that target the same protein as R552, but are meant to treat diseases of the central nervous system, or CNS. Those drugs are part of the new deal too, with Lilly agreeing to lead all clinical development and commercialization for programs going after a CNS indication.
Founded in the mid-1990s, Rigel today is most recognized for its marketed drug Tavalisse, which was approved in 2017 to treat patients with a rare autoimmune disease known as chronic immune thrombocytopenia.
Though the Tavalisse brand is growing — net sales were almost 50% higher in the first nine months of 2020 than in the same period a year prior — that hasn't been enough to make Rigel profitable. The company ended the third quarter with a $14.2 million net loss on $18.4 million in total revenue.
The collaboration with Lilly, though, provides Rigel with an immediate infusion of cash and a potential windfall of milestone payments later on. Rigel investors reacted positively to the deal, lifting the company's share price 21% Thursday morning, to trade at an almost 8-year high of $5.50.
Terms of the deal hold that Lilly and Rigel co-develop R552 at "specified contribution levels." Lilly is responsible for global commercialization costs, though Rigel maintains the right to co-commercialize in the U.S.
Lilly's interest in R552 is rooted in the drug's potential to inhibit RIPK1, the shorthand name for receptor-interacting serine/threonine-protein kinase 1. Research indicates that this enzyme has an effect on cellular processes like the production of cytokines — a kind of signaling protein used by the immune system — as well as a type of regulated cell death called necroptosis that can lead to inflammation.
Lilly isn't alone. RIPK1 has drawn interest from other drugmakers as well, including Sanofi, which in 2018 paid Denali Therapeutics $125 million to develop a group of RIPK1 blockers. Though testing for one was paused after disappointing results, the partners have another expected to begin human trials this year.
Rigel said that in preclinical studies, R552 looked as though it prevented joint and skin inflammation in a RIPK1-mediated rodent model of inflammation and tissue damage. Having completed Phase 1 testing, the company now intends to push its drug into Phase 2 studies.
A spokesperson for Rigel said those studies have not yet been created, and specific disease targets have not yet been announced. The spokesperson added that RIPK1 inhibitors hold the potential to treat "numerous large indications," such as rheumatoid arthritis, psoriasis, asthma, eczema and inflammatory bowel disease.
For Lilly, such a drug could fit nicely into the larger business. The company already has a marketed drug for rheumatoid arthritis, Olumiant, and a blockbuster product in Taltz, which is approved to treat several diseases, including plaque psoriasis and psoriatic arthritis. Lilly is also running Phase 3 studies of experimental treatments for eczema, ulcerative colitis, psoriasis and Crohn's disease.
And on the neuroscience side, Lilly continues to make investments into areas like migraine and Alzheimer's disease. Just last month, it struck a deal with Japan's Asahi Kahei Pharma, securing rights to an experimental drug that's supposed to block a protein linked to neuroinflammation.