Eli Lilly’s Loxo Oncology at Lilly research group will apply Kumquat Biosciences’ small molecule immuno-oncology (I/O) platform to discover, develop, and commercialize potential novel drugs against cancer, through a collaboration that could generate more than $2 billion for the San Diego biotech.
The collaboration is intended to yield new small molecule drugs that stimulate tumor-specific immune responses, by combining Kumquat’s platform and focus on first-in-class therapeutics with the cancer development focus and commercialization expertise of Lilly—whose Lilly Asia Ventures venture fund is among five investors that have invested a total more than $100 million in Kumquat.
“Using small molecule inhibitors to target specific tumor antigens in complex with the immune machinery presents a unique opportunity to stimulate an enhanced tumor-specific immune response,” said Jacob Van Naarden, CEO of Loxo Oncology at Lilly. “We look forward to working with the accomplished Kumquat team to identify candidate medicines that interact with this target class.”
Exactly which small molecule inhibitors Kumquat and Lilly plan to deploy against cancer were not disclosed in the companies’ announcement. Kumquat’s website offers no details about its platform or its pipeline.
Kumquat was co-founded in 2018 by CEO Yi Liu, PhD, a serial entrepreneur with more than 20 years of experience developing small molecule medicines in oncology. Before co-launching Kumquat, Liu in 2012 co-founded Wellspring Biosciences, which pioneered the discovery and development of small molecules directed to the once-undruggable oncoprotein KRAS.
While still at Wellspring in 2018, Liu and colleagues published a study in the journal Cell showing in vivo that mutant KRAS can be selectively targeted, and revealing the company’s ARS-1620—the first small molecule inhibitor that induced tumor regression in patient-derived tumor models, according to Wellspring—as the first in a new generation of KRASG12C-specific inhibitors with promising therapeutic potential.
Liu discussed that research at a symposium held by the University of California, San Diego Moores Cancer Center in February 2019.
Catching up in cancer
Just a month earlier, Lilly signaled its intent to catch up in cancer drug development by becoming a top-tier precision oncology company through the $8 billion acquisition of Loxo Oncology, an announcement timed to coincide with the start of that year’s J.P. Morgan Healthcare Conference.
By the end of 2019, Lilly created Loxo Oncology at Lilly, with the aim of integrating the focus and spirit of a biotech with the scale and resources of large pharma, in order to rapidly deliver “impactful” new treatments for people with cancer: “Our approach centers on creating new oncology medicines that unequivocally work early in clinical development and will matter to patients.”
Under its collaboration with Kumquat, Lilly has the option to select an unspecified “certain number” of drug candidates for further development and commercialization worldwide, excluding Greater China—where Kumquat has retained development and commercialization rights for each candidate to be selected by Lilly, subject to a Lilly option to co-commercialize in that region.
Kumquat also retains an option to co-develop and co-commercialize a certain number of the drug candidates selected by Lilly in the United States.
Lilly said the collaboration with Kumquat will not change its 2021 non-GAAP earnings per share guidance—between $7.80 and $8 a share, a range that Lilly lowered in April from $7.75 to $8.40 when it reported first-quarter earnings, due to a decline in the top end of its range of projected revenues this year, from $28 billion to $27.6 billion.
In addition to Lilly Asian Ventures, Kumquat’s investors include EcoR1 Capital, OrbiMed, Roche Venture Fund, and Sequoia Capital China.
“We are very excited to enter into this collaboration with Lilly,” Liu stated. “Kumquat is developing a novel small molecule I/O platform and this collaboration with Lilly is expected to greatly expedite the development of this platform and maximize its full potential. We look forward to working with Lilly to identify the next generation I/O drugs that will benefit a broad population of patients.”