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Eli Lilly & Co. Options Radionetics for $1B

PHARMA: Deal Includes $140M Upfront, Exclusive Rights to Buy

SAN DIEGO – Radionetics Oncology officially has a suitor.
The Torrey Pines-based biotech announced July 1 a strategic relationship with Eli Lilly and Company (NYSE: LLY) that gives the pharma giant exclusive rights to acquire Radionetics for $1 billion.

The agreement also includes a $140 million upfront cash payment to Radionetics that will help fund its clinical work developing its pipeline of radiopharmaceutical nonpeptide therapeutics for rare endocrine diseases and endocrine-related tumors.

Specifically, Radionetics targets G protein-coupled receptors, or GPCRs for short, which handle many of the signals that pass through the cell’s membrane. The company’s lead program, 68Ga-R8760, is a first-in-class small molecule radioligand imaging agent being developed for patients diagnosed with adrenocortical carcinoma. Radionetics initiated a Phase 1 clinical study of 68Ga-R8760 in October last year.

Brett Ewald, PhD
COO
Radionetics Oncology

“Our platform uniquely pairs the power of radiopharmaceuticals with the precision of small molecule targeting to novel GPCRs. We have a specialized team that is focused on rapidly advancing each of our promising programs to bring these much-needed new therapies to patients,” said Radionetics Chief Operating Officer Brett Ewald.

Radionetics’ 68Ga-R8760 is the first imaging agent developed to localize and identify MC2R-expressing tumors. In adrenocortical carcinoma, researchers have discovered that MC2R is highly expressed on tumors and has limited expression in healthy tissue outside the adrenal gland.

Treatments for adrenocortical carcinoma have long been elusive and patients are in need of new drugs. The last drug to treat the rare cancer was approved by FDA in 1970.

Big Investments by Big Pharma

New advancements in targeted radiopharmaceuticals have prompted Big Pharma to up its investments in the technologies in recent months. In December last year, Bristol Myers Squibb (BMY.N) bought local radiopharma company RayzeBio (Nasdaq: RYZB) for $4.1 billion. That same month, Eli Lilly also made a high-profile purchase of Indianapolis-based radiopharma company POINT Biopharma Global Inc. (Nasdaq: PNT) for $1.4 billion – a deal that Radionetics Oncology CEO Paul Grayson cites as an advantage in working with Eli Lilly to advance Radionetics’ pipeline.

Paul Grayson
CEO
Radionetics Oncology

“We are fortunate to have entered into an agreement with Lilly given its global development capability, oncology expertise, and the radiopharmaceutical experience and capabilities Lilly is building following the acquisition of POINT Biopharma,” he said.

Jacob Van Naarden, Eli Lilly and Company executive vice president and Lilly Oncology president, described the agreement with Radionetics as “furthering [Lilly’s] commitment to radiopharmaceutical therapies.

“This relationship provides access to novel GPCR targets and the discovery capabilities of Radionetics Oncology,” he said.

Jacob Van Naarden
Executive VP
Eli Lilly and Company

The relationship appears to be headed toward something more permanent with Lilly’s now exclusive right to acquire Radionetics following an exercise period – which is good news for Radionetics’ investors who have poured $82.5 million into the company, including a $52.5 million Series A led by Frazier Life Sciences, 5AM Ventures and DCVC Bio that closed in January this year.

The company was launched as a spinout of Crinetics Pharmaceuticals, Inc. (Nasdaq: CRNX) in October 2021 with an initial $30 million in private financing from 5AM Ventures and Frazier Healthcare Partners. At the formation of the spinout company, Radionetics received an exclusive world-wide license to Crinetics’ radiotherapeutics technology platform and associated intellectual property for use in developing radiotherapeutics and related radio-imaging agents in exchange for equity, milestones in excess of $1 billion and single-digit royalties on net sales.

According to an Emergen Research report released in January, the global radiopharmaceuticals market was $5.3 billion in 2022 and is expected to reach $14.45 billion in 2032.n

Radionetics Oncology
FOUNDED: 2021
PRESIDENT & CEO: Paul Grayson
HEADQUARTERS: Torrey Pines
EMPLOYEES: 22
BUSINESS: biotech
VENTURE FUNDING: $82.5 million
WEBSITE: radionetics.com
CONTACT: info@radionetics.com
NOTABLE: Radionetics’ team has collectively worked on more than 10 drugs approved by the FDA.

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