Eli Lilly inks another radiopharma deal, gaining option to buy startup

Dive Brief:

• Eli Lilly is expanding further into radiopharmaceuticals, inking a deal with Radionetics Oncology that gives it an option to later acquire the San Diego biotechnology company for $1 billion.
• Lilly will pay Radionetics $140 million upfront for the option rights under the deal, which the companies announced Monday. Radionetics will continue to build its radiopharmaceutical drug pipeline through an “exercise period,” after which Lilly can choose whether to acquire the company.
• Radionetics is developing small molecule radiopharmaceuticals that can target G protein-coupled receptors, a ubiquitous family of proteins that present many attractive disease targets. The company’s focus is on solid tumors.

Dive Insight:

Radiopharmaceuticals, a targeted alternative to radiation therapy, have become an area of significant pharmaceutical investment. Large firms like Lilly, Bristol Myers and AstraZeneca have made acquisitions to get into the space, lured by technical improvements, clinical successes and regulatory approvals.

Historically, the drugs have been challenging to manufacture and deliver, requiring tightly managed supply chains to ensure the radioisotopes they contain don’t decay. The surge in investment has helped to drive a biotech build-out in capacity.

Lilly has already been active in the field this year, paying startup Aktis Oncology $60 million in May for rights to develop treatments discovered by the company against targets selected by Lilly.

Its largest investment came last year, though, when it bought out Point Biopharma for $1.4 billion. The deal gave the company three clinical-stage candidates, including two that could compete with radiopharmaceuticals from Novartis. Those therapies, Pluvicto and Lutathera, made the company over $1.5 billion in sales last year.

Radionetics spun out from Crinetics Pharmaceuticals in 2021 with $30 million to develop nonpeptide radiopharmaceuticals for a “broad range of oncology indications.” The company then raised a Series A of $52.5 million early this year. The startup is backed by investors such as 5AM Ventures, Frazier Life Sciences, DCVC Bio, GordonMD Global Investments and by Crinetics Pharmaceuticals.