Genome editing technology company Precision BioSciences Inc. (DTIL:NASDAQ) and pharmaceutical giant Eli Lilly and Co. (LLY:NYSE) today announced "a research collaboration and exclusive license agreement to utilize Precision's proprietary ARCUS® genome editing platform for the research and development of potential in vivo therapies for genetic disorders, with an initial focus on Duchenne muscular dystrophy (DMD) and two other undisclosed gene targets."
The firms noted that "genome editing technologies enable precise editing of the DNA of a living organism, opening up the possibility of correcting genetic problems at their source." Precision BioSciences stated that "its proprietary ARCUS platform is derived from a natural genome-editing enzyme called I-CreI, a homing endonuclease that can be optimized to control for potency and specificity."
The companies advised that under the agreement Eli Lilly will make a $35 million equity investment in Precision's common stock and will pay Precision an upfront cash payment in the amount of $100 million. The firms noted that the agreement additionally provides Precision BioSciences with the opportunity to receive up to an additional $420 million if certain development and commercial milestones are met and from future product royalty payments.
The collaboration agreement stipulates that Precision will lead pre-clinical research and IND-enabling activities and Lilly will be in charge of clinical development activities and commercialization. Under the arrangement, Lilly has right to choose up to three additional gene targets.
Precision BioSciences' Chief Scientific Officer and co-founder Derek Jantz commented, "We look forward to working with Lilly to leverage our deep understanding of in vivo gene editing and experience with ARCUS to develop new therapies, including a potentially transformative treatment for Duchenne muscular dystrophy...Collaborating with Lilly, a global healthcare leader with strong clinical and commercial experience in difficult-to-treat diseases, will help us accelerate our work aimed to solve genetic diseases with unique editing challenges."
Ruth Gimeno, Ph.D., V.P. of Diabetes and Metabolic Research at Eli Lilly, remarked, "Gene-edited therapies are emerging as a promising approach to help patients afflicted with genetic conditions...We look forward to working closely with Precision's scientific team and leveraging their platform to develop and deliver breakthrough medicines for untreated genetic disorders."
Eli Lilly's V.P of New Therapeutic Modalities Andrew Adams, Ph.D., added, "This collaboration with Precision BioSciences represents another milestone in the realization of our vision to create medicines with transformational potential, using new therapeutic modalities such as gene editing to tackle targets and indications which were previously undruggable."
The firms stated that the transaction remains subject to ordinary closing conditions and regulatory approval under the Hart-Scott-Rodino Antitrust Improvements Act.
The company explained that the ARCUS proprietary genome editing technology that it created and developed in-house utilizes "sequence-specific DNA-cutting enzymes, or nucleases, that are designed to either insert (knock-in), remove (knock-out), or repair DNA of living cells and organisms." The firm stated that it currently holds more than 65 patents that have been issued for its platform and products.
Eli Lilly is a global healthcare and pharmaceutical manufacturing company based in Indianapolis, Ind. The firm's products include human pharmaceutical products and also animal pet and livestock feed and health products. Eli Lilly has a vast portfolio of medicines used in areas of cardiovascular, endocrinology, immunology, neuroscience and oncology. The company operates in the U.S. and 14 other countries and has a market cap of over $137 billion.
Precision BioSciences is a clinical stage biotechnology company headquartered in Durham, N.C. The firm uses its own proprietary ARCUS genome editing platform to develop "multiple "off-the-shelf" CAR T immunotherapy clinical candidates and several in vivo gene correction therapy candidates to cure genetic and infectious diseases where no adequate treatments exist."
Precision BioSciences started the day with a market capitalization of around $508.0 million with approximately 52.48 million shares outstanding and a short interest of about 5.1%. DTIL shares opened 14% higher today at $11.05 (+$1.37, +14.15%) over yesterday's $9.68 closing price. The stock has traded today between $10.24 and $11.45 per share and is currently trading at $10.95 (+$1.27, +13.12%).
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