Lilly moves quickly to secure $1.6bn buyout of Armo
pharmafile | May 10, 2018 | News story | Medical Communications, Sales and Marketing | Armo Biosciences, Eli Lilly, biotech, drugs, pharma, pharmaceutical
Armo BioSciences only went public in January but it has already been snapped up by Eli Lilly for $1.6 billion. This marks a 68% premium on the closing share price on Wednesday, a significant premium on the IPO price of $17 per share.
Why the rush? Well, its lead drug, pegilodecakin, is deemed to hold plenty of potential in combination with checkpoint inhibitors and this could provide Lilly a gateway into this market, given that it doesn’t have a PD-1/L1 treatment of its own.
The treatment has already reached Phase 3 and with many of the big pharma players being acquisitive when it comes to potential bolt-on treatments in the immunotherapy space, it had to move quickly or miss losing out.
The Phase 3 trial is exploring the treatments use in pancreatic cancer, though it also being trialled in lung cancer and a number of other areas.
As well as this main prospect, Lilly also noted that Armo has a pipeline of candidates working to activate the immune system in its fight against cancer; it has three candidates in the preclinical stage that Lilly picks up alongside the main candidate.
“As we develop our immuno-oncology portfolio, Lilly will pursue medicines that use the body’s immune system in new ways to treat cancer,” commented Levi Garraway, Senior Vice President, Global Development and Medical Affairs, Lilly Oncology, “We believe that pegilodecakin has a unique immunologic mechanism of action that could eventually allow physicians to offer new hope for many cancer patients.”
Given the language used by Garraway, it looks likely that Armo could be the first of several such acquisitions for the pharma business as it looks to boost its oncology portfolio.
Dr Peter Van Vlasselaer, President and Chief Executive Officer of ARMO BioSciences, also commented: “ARMO is proud of the work we have done to advance the study of immunotherapies and of the development of pegilodecakin to-date. Given the resources that Lilly, a leader in oncology R&D, can bring to bear to maximise the value of pegilodecakin and the rest of the ARMO pipeline, we believe it is in the best interest of ARMO, our stockholders and the patients we serve, to execute this transaction.”
The deal is expected to be completed in the second quarter of 2018.
Ben Hargreaves
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