Lilly gains rights to investigational diabetes drug OWL833

US pharma major Eli Lilly (NYSE: LLY) has entered into a license agreement for OWL833, Chugai Pharmaceutical’s (TYO: 4519) oral non-peptidic GLP-1 receptor agonist. OWL833 is a Phase I-ready asset that is being studied for the treatment of type 2 diabetes.

Under the terms of the agreement, Lilly will receive worldwide development and commercialization rights to OWL833. Chugai, which is majority owned by Swiss pharma giant Roche (ROG: SIX), will receive an upfront payment of $50 million and is eligible for milestone payments based on achievement of certain predetermined milestones. If the molecule is successfully commercialized, Chugai would also be eligible for royalty payments.

“As a global leader in diabetes care, Lilly is committed to developing the next generation of diabetes therapies,” said Dr Daniel Skovronsky, Lilly’s chief scientific officer and president of Lilly Research Laboratories. “This exciting new opportunity from Chugai could represent a significant step forward for improving outcomes for people with diabetes.”