A bruised Eli Lilly buys rights to Centrexion's early-stage pain drug for $47.5M upfront
Eli Lilly is working on putting its woes in the rearview mirror. In recent months, a late-stage failure triggered the withdrawal of its cancer drug Lartruvo, the US drugmaker relegated two mid-stage drugs to the scrap heap, and Japan flagged safety concerns associated with its breast cancer treatment, Verzenio.
On Tuesday, the US drugmaker said it was acquiring the rights to an experimental early-stage non-opioid pain drug from Centrexion for $47.5 million upfront. The Boston-based company acquired the chronic pain drug CNTX-0290 — a small molecule somatostatin receptor type 4 (SSTR4) agonist — from Boehringer Ingelheim in 2016.
After kicking off the year with a bang with $8 billion agreement to buy Loxo, in a deal forged in 10 days, things for Lilly $LLY have only gone south. Last month, the company slashed its 2019 forecast by $3 billion — reflecting the Elanco Animal Health spin off — and is in desperate need for assets to improve its pipeline and prospects.
Apart from the issues outlined above, Lilly is also struggling on the R&D side. Earlier this year, researchers renewed safety fears about its once-touted blockbuster contender tanezumab and the larger anti-NGF pain drug class; the company abandoned a mid-stage BTK inhibitor, shrugging off a $690 million pact for the immunology drug — in-licensed from Korea’s Hanmi three years ago; partner Incyte $INCY halted all further R&D investments in Olumiant, a JAK inhibitor that barely managed an FDA approval, with a lower dose than Lilly had advocated for after regulators raised serious safety concerns about the drug — and the class; and then there’s the Alzheimer’s drug solanezumab, which has failed three pivotal programs but is still marinating in late-stage development, despite most observers having written it off as collateral damage in the all-but-dead amyloid beta hypothesis.
Lilly’s existing drugs aren’t in the best shape either. The company is facing fierce pressure to rein in the prices of its arsenal of diabetes drugs, while its erectile dysfunction treatment Cialis is being eaten up by generic competition.
In the deal announced on Tuesday, Centrexion may be eligible for up to $575 million in potential development and regulatory milestones. If CNTX-0290 is approved, Centrexion could get another $375 million in potential sales milestones and tiered royalties.
The privately-held company, led by former Pfizer $PFE chief Jeffrey Kindler, reportedly postponed its plans for a $75 million IPO last November. Its lead drug, CNTX-4975, is in late-stage development. The experimental treatment is a man-made version of chili plant extract trans-capsaicin and is designed to work by inactivating local pain fibers transmitting signals to the brain.