Eli Lilly and Co. is establishing a new venture capital fund that would seek to acquire experimental drugs from outside researchers and use Lilly’s Chorus unit to decide if they are promising enough to launch large, expensive human trials.
Lilly would then have “preferential access” to acquire the molecules itself and add them to its pipeline, said Lilly CEO John Lechleiter during a presentation to investors this morning in New York.
Lilly’s Chorus subsidiary, founded in 2002, has reduced the time and cost to figure out whether an experimental drug molecule affects a certain illness. Chorus has done this by using outside firms for 80 percent of its work, as well as pushing to identify proteins in the body, or biomarkers, that show a drug’s effectiveness sooner than patients and doctors could report manually.
Lechleiter said Lilly would also use “other alternative development engines” to decide whether the experimental drugs are promising for large human trials, something known in the drug industry as “proof of concept.”
Lilly spokesman Mark Taylor said the company would release further details about the fund in January.
“It continues on with the FIPNet strategy,” said Taylor, referring to Lilly’s efforts to use outside researchers and developers to share in the risk and reward of developing new medicines. He added, “It gets us in on the ground level.”
Lilly is not a stranger to the venture capital world. In 2001, it launched Lilly Ventures to invest in companies that it thought could produce a handsome return. It also looked to invest in companies that were developing technologies related to Lilly’s business.
Lilly has put $200 million in Lilly Ventures, including a fresh $25 million investment earlier this year.