Acquisitive Eli Lily picks up AurKa Pharma

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Eli Lilly has made its second acquisition in under week after swooping for AurKa Pharma in a deal that’s potentially worth up to $575 million.

This latest deals follows Lilly’s $1.6 billion acquisition of ARMO BioSciences, announced last week.

AurKa Pharma was established by TVM Capital Life Science to develop oncology compound AK-01, an Aurora kinase A inhibitor that was originally discovered at Lilly.

The compound is a potential first-in-class asset that AurKa Pharma is studying in Phase 1 clinical trials in multiple types of solid tumours.

Aurora kinases are believed to play a crucial role in cellular division by controlling chromosomal segregation. Defects in segregation can cause genetic instability, a condition highly associated with the formation of tumours.

Consisting of Aurora A, Aurora B and Aurora C, Aurora kinases are key mitotic regulators required for genome stability and are frequently overexpressed in cancerous tumours.

AurKa Pharma’s asset, AK-01, has been shown to be highly selective for Aurora A, with potential clinical benefit observed in Phase 1 studies. Future studies will seek to determine if the selectivity profile of AK-01 can improve efficacy while limiting toxicity risks to a manageable level.

After a review of its clinical pipeline priorities in 2016, Lilly sold the compound to TVM Capital Life Science, which then established AurKa as part of the TVM Life Science Ventures VII fund.

The fund is a novel investment model that seeks to develop early-stage pharmaceutical assets in a capital-efficient manner. As part of its innovation strategy, Lilly actively participates with venture capital firms to source early stage opportunities.

Lilly will now acquire all shares of AurKa Pharma. In return, AurKa Pharma shareholders will receive an upfront payment of $110 million. Shareholders are also eligible to receive up to $465 million in regulatory and sales milestones should AK-01 gain approval in the US and other markets, and achieve certain sales levels.