Eli Lilly will pay as much as $50 million to partner with China-based biotech Regor Therapeutics, announcing Friday a multi-year research and licensing deal aimed at discovering and developing new medicines for metabolic disorders like diabetes and obesity. Lilly will also invest in Regor, taking an undisclosed equity stake in the company as part of its upfront commitment. Regor could receive as much as $1.5 billion more from the Indianapolis-headquarted pharma should it hit certain development and commercial milestones. Per deal terms, Lilly will get a license to select Regor research and be responsible for any subsequent clinical testing, manufacturing and commercialization, except in China, Macau, Hong Kong and Taiwan.Lilly's deal with Regor is another example of large pharmaceutical companies in the U.S. and Europe showing interest in Chinese biotechs for their research, rather than as a means of accessing the second-largest market for prescription drugs. In recent years, Amgen, Pfizer and Seagen have struck partnerships with, or invested in China-based biotechs, while AstraZeneca set up a new R&D center in Shanghai to, among other things, better collaborate with companies there. The investment has come as Chinese biotechs have taken advantage of new rules for stock listings in Hong Kong to raise record-setting sums. Amgen's 2019 partnership with Beigene, which has a market capitalization of $30 billion on Nasdaq, was the most notable, both by financial value and for the number of clinical-stage drugs involved. Lilly, too, has dipped its toes into China-based biotech research. In 2015, the drugmaker grabbed partial rights to a cancer immunotherapy developed by Innovent Biologics. That drug, now known as Tyvyt, has since been approved in China for two types of lymphoma and could be cleared for lung cancer as well. Last year, Lilly paid $200 million to broaden the partnership. Lilly's deal with Regor is far smaller, but signals the pharma's continued interest in the emerging science coming from biotechs built in China. Founded in 2018, Regor recently raised $90 million in Series B funding from a group of investors that included Lilly Asia Ventures, a former subsidiary of the pharmaceutical company that was later spun off. Regor, which touts a drug discovery platform called CARD, has development programs in metabolic disorders and in cancer. It's two most advanced candidates target GLP-1R, a pancreatic protein that's received attention from diabetes drugmakers. One is in clinical testing. Lilly did not specify which targets in particular it hopes to work on with Regor. The pharma already has programs in diabetes and obesity that target GLP-1R. The collaboration will not change Lilly's guidance for expected earnings per share this year.
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