Eli Lilly and Co. and Health Care Businesses and Health Care & Life Sciences and Health Care & Insurance and Pharmaceutical

Lilly acquires biotech company with pancreatic drug

July 2, 2010

Eli Lilly and Co. has agreed to buy a Massachusetts-based biotech firm that is developing an enzyme-replacement therapy for disorders of the pancreas.

Alnara Pharmaceuticals Inc., which has attracted $55 million in venture capital in the past two years, recently submitted its drug to the U.S. Food and Drug Administration for market approval. The oral drug, called liprotamase, has shown in clinical trials that it can reverse a nutritional deficiency patients experience with specific pancreatic disorders.

That condition can be caused by cystic fibrosis, a disease that afflicts about 30,000 Americans and about 100,000 people worldwide, accord to Lilly and Alnara.

Financial terms of the deal were not disclosed, which means the deal is not large enough to have a material impact on Lilly’s finances.

However, Lilly must acquire new drugs in order to fill a gaping hole in its revenue expected to widen when its $5 billion-a-year drug Zyprexa begins to face generic competition in October 2011. Five years from now, five of Lilly’s bestselling drugs will have had their revenue sapped by generics, likely draining Lilly of more than $10 billion a year.

In 2009, Lilly had total revenue of $21.8 billion.

Lilly hopes that Alnara’s drug gains more acceptance among patients because it does not require them to take as many pills as existing treatments. Liprotamase is also not derived from pigs, as some current treatments are.

"The acquisition of Alnara provides Lilly with a promising entry into enzyme replacement therapy—an area with unmet medical needs as well as opportunities for novel compounds that give patients additional treatment options," said Bryce Carmine, president of Lilly’s BioMedicines division.

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