Eli Lilly and Company (LLY) and CureVac AG have announced a global immuno-oncology collaboration focused on the development and commercialization of up to five potential cancer vaccine products based on CureVac's proprietary RNActive® technology. The companies will use messenger RNA (mRNA) technology that targets tumor neoantigens for a more robust anti-cancer immune response.

"We are excited to be collaborating with CureVac to discover what could potentially be the next frontier of cancer medicines," said Greg Plowman, M.D., Ph.D., vice president of oncology research at Lilly. "This collaboration reinforces Lilly's commitment to delivering life-changing medicines to treat and cure people living with cancer around the world."

Ingmar Hoerr, Ph.D., co-founder and CEO of CureVac, stated, "This new collaboration with Lilly is a testimony to the progress and sophistication of CureVac's RNActive technology and the potential of mRNA-based therapeutics. We now have the opportunity to combine forces to further expand the exciting space of immuno-oncology with the next generation of cancer therapies. We are thrilled to work with the Lilly team and hope to advance this new treatment paradigm into the clinic and ultimately to the market."

Under the terms of the agreement, CureVac will receive an upfront payment of $50 million and an equity investment of €45 million. CureVac is also eligible to receive more than $1.7 billion in development and commercialization milestones if all five vaccines are successfully developed, plus tiered royalties on product sales. Lilly is responsible for target identification, clinical development and commercialization. CureVac will be responsible for mRNA design, formulation and manufacturing of clinical supply and retains the option to co-promote the vaccine products in Germany.

CureVac's proprietary RNActive technology will be used to deliver mRNA that ultimately directs the human immune system to target the encoded neoantigens. These tumor-specific neoantigens instruct the patient's existing immune system to mount a selective and potent response to eradicate the cancer.

This transaction is subject to clearance under the Hart-Scott-Rodino Antitrust Improvements Act and other customary closing conditions. Subject to the closing of this transaction, Lilly expects to incur an acquired in-process research and development charge to earnings of approximately $0.03 per share.