Eli Lilly and Company and Sigilon Therapeutics, a privately held biopharmaceutical company, announced a global collaboration to develop encapsulated cell therapies for potentially treating Type 1 diabetes. The deal is worth up to $473 million. Sigilon is focused on discovering and developing “living therapeutics” using its Afibromer technology product platform.

Under the agreement, Lilly will receive an exclusive worldwide license to Sigilon’s Afibromer technology for islet cell encapsulation. Lilly will pay Sigilon an upfront payment of $63 million and will make an undisclosed equity investment in the company. Sigilon is also eligible to receive up to $410 million in development and commercialization milestones, as well as single- to double-digit tiered royalties on future product sales if the collaboration yields a commercially successful product.

Sigilon will be responsible for all development activities and costs related to the collaboration until submission of an investigational new drug application (IND). After an IND is submitted, Lilly will be responsible for all clinical development and commercialization activities and costs related to the collaboration.

Under the collaboration, Sigilon will create proprietary products comprised of induced pluripotent stem cells, a type of stem cell derived from adult cells, engineered into differentiated insulin-producing pancreatic beta cells. These cells are encapsulated using Sigilon’s Afibromer technology. The goal of these products will be to restore insulin production over sustained periods, without triggering an immune reaction.

An emerging area of research

Sigilon reports that encapsulated cell therapy is an emerging area of biopharmaceutical research that aims to unlock the therapeutic potential of cells to treat serious diseases without the need for immunosuppression. The approach holds promise to address chronic conditions, such as Type 1 diabetes in which pancreatic beta cells are destroyed by the immune system, leading to hyperglycemia and long-term complications if glucose levels are not managed effectively.

“At Lilly, we endeavor to change the frontiers of what’s possible in medicine, both through our own scientific labs and in collaboration with other leading researchers,” said Daniel Skovronsky, MD, PhD, senior vice president for clinical and product development and incoming president of Lilly Research Labs, in a company press release. “We are excited to be collaborating with, and investing in, Sigilon as they seek to develop encapsulated cell therapies, a potentially disruptive technology that could result in meaningful clinical advancements for chronic diseases such as [T]ype 1 diabetes.”

“We are very pleased to partner with Lilly, a worldwide leader in diabetes care, as we seek to apply Sigilon’s game-changing technology to the area of insulin-dependent diabetes,” commented Paul Wotton, PhD, CEO of Sigilon Therapeutics, the press release. “At Sigilon, published studies have shown the ability to overcome the immune foreign body response with our proprietary Afibromer technology. This holds the promise for the creation of state-of-the-art allogeneic cell factories to be transplanted into patients, without the need for immune suppression. Our cell engineering and delivery system-based platform may allow us to program and control dynamic protein delivery for the long-term treatment of debilitating diseases.”