Eli Lilly is pulling out its checkbook again to acquire another cancer drug developer, this time inking a deal for early-stage company AurKa Pharma.
Under the agreement announced Monday, Indianapolis-based Lilly (NYSE: [[ticker:LLY]]) will pay $110 million up front for AurKa. If the AurKa drug hits regulatory and commercialization milestones, AurKa shareholders could gain up to $465 million more in milestone payments. The AurKa acquisition comes on the heels of Lilly’s announcement last week that it would pay $1.6 billion to acquire Armo BioSciences (NASDAQ: [[ticker:ARMO]]), a Redwood City, CA, company whose lead drug has the potential to be combined with other treatments to expand the reach of cancer immunotherapy.
AurKa focuses its research on a family of enzymes that play a role in cell division of cancer cells. These enzymes, called Aurora kinases, are abundant in tumors and have emerged as potential targets for new cancer drugs. There are three Aurora enzymes: Aurora A, Aurora B, and Aurora C. The AurKa drug, AK-01, specifically targets the enzyme Aurora kinase A. AurKa has advanced the drug into Phase 1 testing.
The deal for AurKa brings its drug full circle. The compound was originally discovered at Lilly. In 2016, the pharmaceutical giant sold the drug to venture capital firm TVM Capital Life Science, which formed Montreal-based AurKa. Lilly says part of its strategy involves working with venture capital firms to develop early-stage compounds. TVM says the drug has the potential to treat certain solid tumors, including those of small cell lung cancer and treatment-resistant breast cancer.
Image of metastatic breast cancer by Flickr user Ed Uthman via a Creative Commons license
