Eli Lilly is acquiring precision medicine biotech Akouos for $487 million in cash in a deal focused on developing gene therapies for hearing loss.
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Eli Lilly is acquiring precision medicine biotech Akouos for $487 million in cash in a deal focused on developing gene therapies for hearing loss, the companies announced Tuesday.
Under the terms of the agreement, Lilly will buy all outstanding shares of Akouos at a per-share price of $12.50. This represents a premium of around 121% to Akouos’ 30-day volume-weighted average trading price.
The deal also includes a contingent value right that entitles shareholders to receive up to $3.00 more in cash per share. This brings the total acquisition value to $610 million. The buyout is expected to close before the year ends.
In exchange, Lilly gains access to Akouos’ lead program AK-OTOF, a gene therapy designed to treat hearing loss by delivering a functional copy of the otoferlin gene. Delivered using an adeno-associated viral vector, AK-OTOF seeks to restore the normal function of hair cells in the cochlea, allowing them to release neurotransmitters in response to sound stimulus.
The candidate is currently in the late pre-clinical stage.
In May, Akouos presented early data showing that cells treated with AK-OTOF can produce a full-length and functional otoferlin mRNA and protein. Last month, the FDA cleared AK-OTOF’s investigational new drug application, making it the first therapy for genetic hearing loss to receive this regulatory nod. The company is preparing for a Phase I/II trial of AK-OTOF.
Akouos’ pipeline also contains an anti-VEGF candidate for vestibular schwannoma and AK-CLRN1, a gene therapy for Usher Syndrome type 3A.
Aside from pipeline candidates, Lilly will also gain access to Akouos’ cutting-edge, targeted delivery platform, which uses a novel AAV technology to efficiently inject its gene therapy payloads into inner-ear cells.
The buyout will also transfer the Sing Registry over to the Big Pharma. Sing is a longitudinal and observational study that interrogates how a person’s genes affect their hearing changes over time.
Lilly’s $487 million investment will also onboard Akouos’ team of experts highly experienced in the field of hereditary hearing loss. Aside from gene delivery, the Akouos team can also deploy genomic technologies to design precision therapeutics and edit out mutated gene sequences responsible for toxic or faulty proteins.
In a statement, Daniel Skovronsky, M.D., Ph.D., Lilly’s chief scientific and medical officer and president of Lilly Research Laboratories, said Akouos’ deep expertise, combined with Lilly’s resources and reach, could lead to innovative and potentially transformative treatments in the hearing loss space.
“With Akouos, we are optimistic that we can make a difference for people with hearing loss and other inner ear conditions,” he said.
Akouos is Lilly’s second gene therapy investment. In 2021, the industry heavy-hitter dropped some $1.04 billion to buy Prevail Therapeutics. The acquisition also marked the beginning of Lilly’s gene therapy program, which counted Prevail’s neuroscience pipeline as its first asset.
Prevail focused on disease-modifying gene therapies for neurodegenerative diseases. Its lead candidates were PR001 for Parkinson’s disease with GBA1 mutations and neuronopathic Gaucher disease and PR006 for frontotemporal dementia with GRN mutations.
