Eli Lilly, Avidity in Immunology Licensing, Research Agreement of Up to $440 Mln

Eli Lilly and Co. (LLY) said it agreed to a global licensing and research collaboration worth a potential $440 million with Avidity Biosciences Inc. to develop and distribute potential new medicines in immunology and other select indications.

Avidity will contribute its technology platform to progress new therapeutic approaches toward clinical development and commercialization, the pharmaceutical companies said Monday.

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Under the terms of the agreement, Avidity will receive an upfront payment of $20 million, as well as an investment of $15 million.

Avidity is also eligible to receive up to approximately $405 million per target for development, regulatory and commercialization milestones, as well as tiered royalties ranging from the mid-single to low-double digits on product sales.

Lilly says the transaction will be reflected in its GAAP reported results and financial guidance, with no change in 2019 non-GAAP EPS guidance as a result of this transaction.