Lilly pays $55M for rights to KeyBioscience’s diabetes assets

The headquarters of Eil Lilly

Eli Lilly is paying $55 million upfront for the rights to KeyBioscience’s pipeline of treatments for Type 2 diabetes and other metabolic conditions. The agreement gives Lilly the global rights to phase 2 synthetic peptide dual amylin and calcitonin receptor agonist KBP-042 and other programs.

Lilly is handing over $55 million upfront and committing to an undisclosed amount of milestones for the rights to KBP-042 and follow-up assets. The earlier-stage assets have advanced no further than phase 1. KeyBioscience designed these drugs, which include BP-089 and KBP-056, to have the same broad mechanism of action as KBP-042 but deliver different effects or potency because of changes to their engineering.

KeyBioscience has high hopes for the mechanism of action.

"We are extremely excited about the promise of this new mechanism, which could potentially improve insulin sensitivity, reduce weight and improve blood glucose control," KeyBioscience chairman Morten Karsdal said in a statement.

The range of improvements targeted by KeyBioscience reflects its assets’ dual targets. Amylin is the target of AstraZeneca’s Symlin, a drug research has linked to reductions in insulin-induced weight gain and the regulation of glucose excursions after eating. Calcitonin is less well established as a target of metabolic disease drugs but KeyBioscience has preclinical data to back up its belief in the dual agonist approach.

The novel dual agonist approach could give Lilly an edge over its rivals in the fierce fight for the diabetes market. Lilly’s competitors are also working on drugs that help diabetics manage multiple aspects of the disease and their comorbidities. Sanofi, for example, penned a deal worth up to €250 million ($281 million) with Exscientia last month to develop bispecific small molecules. These molecules could manage glucose levels while also helping patients to control their weight.

KeyBioscience has similar aspirations for its assets. The biotech was created by Danish CRO Nordic Bioscience to develop a family of metabolic peptides. Since then, it has generated preclinical data and pushed its lead candidate into phase 2 while also working with Enteris BioPharma on oral formulations of its peptide pipeline candidates.

That platform enabled KeyBioscience to attract the interest of Lilly. KBP-042 will slot into Lilly’s mid-phase diabetes pipeline alongside ultra-rapid insulin prospect LY900014.