Lilly to raise $750M to share R&D costs
Eli Lilly is well aware of the growing challenges of R&D--CEO John Lechleiter has often addressed the topic even as his company faces late-stage setbacks. Now the pharma is taking a new approach to early R&D that it hopes will allow it to share some of the financial burden.
The company plans to raise up to $750 million through three funds; each fund will start with a $50 million investment from Lilly, with further funding coming from venture capitalists. A slate of experimental drugs will be explored by virtual drug companies, with Lilly getting first shot at licensing any promising therapies developed as a result of the program. Lechleiter told the Financial Times that one such fund has already been finalized.
This new approach will expand the company's early-stage pipeline without forcing Lilly to foot the entire R&D bill. Additionally, the developer can select the most promising programs to advance into mid and late-stage trials. "We think this is a very different kind of model," Lechleiter told the Times. "This way we are not limited by our own resources and we can have more 'shots on goal."
- read the Financial Times report