Type of information: Company acquisition
Acquired company: AurKa Pharma (Canada)
Acquiring company: Eli Lilly (USA - IN)
Amount: up to $575 million
- • On May 14, 2018, Eli Lilly announced an agreement to acquire AurKa Pharma, a company established by TVM Capital Life Science to develop oncology compound AK-01, an Aurora kinase A inhibitor that was originally discovered at Lilly. Under the terms of the agreement, Lilly will acquire all shares of AurKa Pharma. In return, AurKa Pharma shareholders will receive an upfront payment of $110 million. AurKa Pharma shareholders are also eligible to receive up to $465 million in regulatory and sales milestones should AK-01 gain approval in the U.S. and other markets, and achieve certain sales levels.
- This transaction will be reflected in Lilly's reported results and financial guidance according to Generally Accepted Accounting Principles (GAAP), and is subject to customary closing conditions. There will be no change to Lilly's 2018 non-GAAP earnings per share guidance as a result of this transaction.
- Baird is acting as financial advisor to AurKa in this transaction.
- AurKa Pharma is a company established by TVM Capital Life Science to develop oncology compound AK-01, an Aurora kinase A inhibitor that was originally discovered at Lilly. The compound is a potential first-in-class asset that AurKa Pharma is studying in Phase 1 clinical trials in multiple types of solid tumors. Aurora kinases, consisting of Aurora A, Aurora B and Aurora C, are key mitotic regulators required for genome stability and are frequently overexpressed in cancerous tumors. AurKa Pharma's asset, AK-01, has been shown to be highly selective for Aurora A, with potential clinical benefit observed in Phase 1 studies. Future studies will seek to determine if the selectivity profile of AK-01 can improve efficacy while limiting toxicity risks to a manageable level.
- After a review of its clinical pipeline priorities in 2016, Lilly sold the compound to TVM Capital Life Science, which then established AurKa as part of the TVM Life Science Ventures VII fund.
Related: Cancer - Oncology