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Eli Lilly Partners with AC Immune on Tau Blockers for Alzheimer’s

Xconomy Indiana — 

There’s at least one major pharmaceutical company that isn’t giving up yet on finding a drug for Alzheimer’s disease, despite a long trail of clinical flops. Eli Lilly is pairing up with AC Immune to develop drugs that block tau, a protein linked to the neurodegenerative disease.

Under the agreement announced Wednesday, AC Immune (NASDAQ: ACIU) will receive from Lilly about $80 million up front, plus $50 million in the form of a convertible note, a form of debt financing that converts into equity later on. The Swiss company stands to gain another $60 million in near-term milestone payments, as well as other milestone payments of up to $1.7 billion, and royalties, should the drug come to market.

Like several of its competitors, Lilly (NYSE: LLY) has had to revisit its Alzheimer’s strategy in the wake of numerous recent failures of drugs that target amyloid, another protein that clogs up the brains of Alzheimer’s patients. In 2016, the company admitted a Phase 3 defeat with its anti-amyloid drug, solanezumab.  The amyloid hypothesis may not be quite dead yet, with Biogen (NASDAQ: BIIB) and Eisai (OTCMKTS: ESALY) still plowing ahead with their anti-amyloid antibody, aducanumab, in large Phase 3 studies expected to report data late next year or in early 2020.

But Lilly, it seems, is moving on, showing with this latest deal that it wants to try targeting tau tangles, even though it isn’t completely clear if tau, like amyloid, is causing the disease. The AC Immune lead drug at the center of the partnership, ACI-3024, is a small molecule designed to inhibit tau buildup in the brain.

In the collaboration announced today, AC Immune will be in charge of the Phase 1 trial of ACI-3024. Lilly will take over further clinical development if it gets that far and will have worldwide commercialization rights for the drug in Alzheimer’s disease.