Just 14 months ago, Eli Lilly and Co. announced “a multi-year collaboration” with a Maryland biotech firm to discover new cancer targets and develop immuno-oncology therapies.
“The emerging field of immuno-oncology is offering new treatment options and hope to cancer patients,” Dr. Greg Plowman, vice president of oncology research at Indianapolis-based Lilly, said at the time.
But that collaboration turned out to be much shorter than expected, illustrating the uncertain world of drug development.
On Jan, 10, Lilly quietly killed the deal with NextCure Inc., effective March 3, after spending $40 million on an up-front fee and equity investment, and with little to show from the partnership.
Suburban Washington, D.C.-based NextCure announced the termination on Jan. 13, in a terse, one-sentence filing with the Securities and Exchange Commission. It gave no details and did not return calls to IBJ to elaborate.
Lilly did not issue a press release or make a government filing on the termination. Lilly spokesman Mark Taylor confirmed to IBJ that the collaboration was terminated, and said Lilly “will most likely include a disclosure” in its next quarterly filing, which will take place on Jan. 30.
“I am not able to provide comment for the reason for the agreement’s termination,” Taylor added.
The deal, when it was announced, carried high hopes that the two companies could work together in the fast-growing field of immuno-oncology. The announcement used such terms as “groundbreaking” and “new generation” of therapies.
“Through this collaboration, we hope to leverage NextCure’s discovery platform to expand the reach of this class of groundbreaking treatments by identifying novel cancer targets that could enable the development of a new generation of immuno-oncology therapies,” Lilly’s Plowman said at the time.
In recent years, immunotherapy has attracted billions of dollars in research at pharmaceutical companies, medical schools and other research institutes. They are racing to develop new treatments for cancer, Parkinson’s disease, Alzheimer’s disease, lupus, rheumatoid arthritis and a host of other diseases related to the body’s immune system.
In cancer cases, immunotherapy typically works by stimulating the body’s own immune system to fight diseases it wouldn’t normally target or hasn’t been able to eradicate.
The excitement is building off of some notable clinical successes in the past five years aimed at attacking forms of cancer that five years ago were almost considered death sentences. Bristol-Myers Squibb launched a new drug, Yervoy, to treat late-stage melanoma, and Merck launched one called Keytruda to treat a devastating form of lung cancer. It since has been approved for treating several other kinds of cancer.
And Lilly has been pushing to move more aggressively into the sector. In May 2018, the drugmaker announced it was buying Armo BioSciences Inc., a California-based, publicly traded biotech firm, for $1.6 billion. Armo was considered a rising star in the burgeoning field of immuno-oncology.
Armo’s lead product candidate, pegilodecakin, was in a late-stage clinical trial for pancreatic cancer and in earlier-stage trials for lung and renal cell cancer, melanoma and other solid tumors. But last fall, Lilly said the experimental drug failed to meet its goal of overall survival in the pancreatic cancer trial.
Meanwhile, Lilly is pushing to become a bigger player overall in cancer treatments. In 2018, cancer drugs accounted for about 20 percent of Lilly’s revenue, or $4.3 billion, ranking Lilly ninth in oncology pharmaceuticals. In January 2019, Lilly paid $8 billion to buy Loxo Oncology, a Connecticut-based startup that is developing cancer-treating medicines based on tumors’ genetic traits.
For NextCure, the termination of a collaboration with Lilly is sure to sting. The deal was potentially worth up to $1.4 billion, if Lilly successfully developed and commercialized new cancer therapies resulting from the collaboration. NextCure has no products on the market, and lost $22.8 million for the first nine months of 2019.
The biotech was co-founded by Michael Richman, its president and CEO, formerly of MedImmune and MacroGenics. The other co-founder is Lieping Chen, a Yale University professor whose research led to NextCure’s pipeline, according to the Washington Business Journal.
NextCure had its initial public offering in April 2019. Its stock rose as high as $109 last fall, but now is trading in the low $50s.