Zydus Cadila has signed a new drug discovery and development agreement with Eli Lilly and Company, which focuses in the area of cardiovascular research.
This alliance seeks to increase productivity in drug discovery and development by synergizing the unique strengths of both companies. The collaborative research programme may continue for a span of up to six years.
Zydus will work to discover and develop potential molecules against a novel target, primarily in cardiovascular research. It will initiate the drug discovery, lead identification and optimization, and conduct pre-clinical studies and clinical trials up to Phase II Human Proof-of-Concept.
Lilly will provide chemical starting points as well as expertise and feedback regarding toxicology, ADME, chemistry, biology, clinical and regulatory aspects as needed to potentially increase the probability of success of the programme.
As part of the agreement, Lilly will have the option to licence any resulting molecules at different stages.
Zydus would receive potential milestone payments of up to $300 million and royalties on sales upon successful launch of any compounds derived from the research programme. We maintain a BUY on the stock, with a target price of Rs350.