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Lilly expands dermatology portfolio with $1.1bn Dermira deal

Deal includes FDA fast-tracked eczema drug

Lilly

Eli Lilly has kicked off the new year with a $1.1bn takeover of dermatology specialist Dermira, setting the pace for pharma M&A as we enter a new decade.

Under the terms of the deal, Lilly will gain rights to Dermira’s single marketed drug – Qbrexza (glycopyrronium), a medicated cloth approved for use in primary axillary hyperhidrosis, or uncontrolled excessive underarm sweating.

The pharma giant is also set to gain an additional phase 3 candidate from the deal – lebrikizumab, a monoclonal antibody designed to bind to IL-13 that is being evaluated for the treatment of moderate-to-severe atopic dermatitis (the most common from of eczema) in patients aged 12 and older.

Dermira gained the bulk of the rights to the IL-13 inhibitor in a licensing deal with Roche it signed back in 2017. Roche had been developing lebrikizumab as a potential treatment for severe asthma, but after the drug produced disappointing results in that indication decided to sell it on.

Dermira gained a fast track designation in atopic dermatitis for the drug from the FDA in December on the strength of phase 2b study results, in which lebrikizumab demonstrated a dose-dependent response across all endpoints, with a market improvement at the different dosing schedules tested.

If approved, Lilly’s newly acquired drug will closely compete with Sanofi/Regenerons’s Dupixent (dupilumab) which grew 142% in the last quarter to $637m.

"The acquisition of Dermira is consistent with Lilly's strategy to augment our own internal research by acquiring clinical phase assets in our core therapeutic areas and leveraging our development expertise and commercial infrastructure to bring new medicines to patients,” said Patrik Jonsson, Lilly senior vice president and president of Lilly Bio-Medicines.

“This acquisition provides an opportunity to add a promising Phase 3 immunology compound for atopic dermatitis, while also adding an approved dermatology treatment for primary axillary hyperhidrosis,” he added.

Lilly is set to pay Dermira $18.75 per share, a 2.2% premium to Dermira’s last closing price. On the back of the acquisition announcement, Dermira’s shares climbed 5.1% to $19.28, above Lilly’s offer price.

For Lilly, the deal for Dermira is just one in a string of similar acquisitions, all aimed at expanding its core focus portfolio. One of the largest of these deals was its $8bn buyout of Loxo Therapeutics at the beginning of last year.

From that deal, Lilly gained TRK inhibitor Vikrakvi (larotrectinib), a targeted cancer drug for the treatment of adult and paediatric patients with locally advanced or metastatic solid tumours with a neurotrophic tyrosine receptor kinase (NTRK) gene fusion biomarker.

The Dermira deal is likely to feed into Lilly’s growth over 2020 – in December, the company offered a financial update that predicted expected revenue over the year to reach between $23.6bn and $24.1bn.

Article by
Lucy Parsons

13th January 2020

From: Sales

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