Eli Lilly and Company has agreed to acquire privately-held biotechnology company Disarm Therapeutics for an upfront payment of $135m.
The deal also allows Disarm equity-holders to secure up to $1.225bn in additional future payments for potential development, regulatory and commercial milestones based on the successful development and commercialisation of new medicine resulting from the acquisition.
Disarm Therapeutics is involved in the development of a new class of disease-modifying therapeutics for patients with axonal degeneration, a central driver of neurological disability and disease progression.
The company has discovered novel SARM1 inhibitors and is accelerating them into preclinical development to offer breakthrough treatments to patients with peripheral neuropathy and other neurological diseases such as amyotrophic lateral sclerosis (ALS) and multiple sclerosis.
Disarm CEO Dr Alvin Shih said: “Disarm’s innovative approach to treating axonal degeneration holds tremendous promise for addressing a wide spectrum of neurological diseases, and we have made significant strides toward enabling potentially transformative therapies.”
Disarm was established by Atlas Venture, Drs Milbrandt and DiAntonio of Washington University School of Medicine in St. Louis, and Atlas Entrepreneurs-in-Residence Dr Rajesh Devraj and Dr Raul Krauss.
Lightstone Ventures and AbbVie Ventures co-invested with Atlas to carry out the foundational work at Disarm.
Lilly pain and neurodegeneration research vice president Dr Mark Mintun said: “The scientific team at Disarm discovered an important and highly promising approach to combat axonal degeneration. We will move quickly to develop their SARM1 inhibitors into potential medicines for peripheral neuropathy and neurological diseases, such as ALS and multiple sclerosis.”
Aquilo Partners served as financial advisor and WilmerHale and WilmerHale as legal advisor to Disarm for the deal.
In June this year, Eli Lilly commenced a phase 3 clinical trial with baricitinib, marketed as Olumiant, for hospitalised Covid-19 patients.