Eli Lilly and Company and Incyte Corporation announced that Lilly has submitted a new drug application (NDA) to the U.S. Food and Drug Administration
(FDA) for the approval of oral once-daily baricitinib for the treatment
of moderately-to-severely active rheumatoid arthritis (RA).
As a result, Incyte will receive a milestone payment of $35 million from Lilly related to the NDA submission. If baricitinib is granted U.S. regulatory approval, Incyte will receive a milestone payment of $100 million from Lilly. Incyte
could earn additional global regulatory as well as sales-based
milestone payments and be eligible for royalties on global net sales of
baricitinib.
If approved, Lilly will lead launch and global commercialization
efforts for baricitinib in RA. Lilly owns global rights to develop and
commercialize baricitinib as an oral treatment for all inflammatory
conditions. This submission milestone will result in a first-quarter charge to
Lilly's GAAP and non-GAAP research and development expense of $35 million (pre-tax). Lilly's previously-issued 2016 GAAP and non-GAAP EPS guidance of $2.92-$3.02 and $3.45-$3.55, respectively, remain unchanged.
Baricitinib is the only once-daily oral selective JAK1 and JAK2
inhibitor currently in late-stage clinical studies for inflammatory and
autoimmune diseases. There are four known JAK enzymes: JAK1, JAK2, JAK3
and TYK2. JAK-dependent cytokines have been implicated in the
pathogenesis of a number of inflammatory and autoimmune diseases,
suggesting that JAK inhibitors may be useful for the treatment of a
broad range of inflammatory conditions. Baricitinib demonstrates
approximately 100-fold greater potency of inhibition against JAK1 and
JAK2 than JAK 3 in kinase assays.
