Eli Lilly and Company, a global healthcare leader, and Incyte Corporation, a biopharmaceutical company, announced that Lilly has submitted a new drug application (NDA) to the US Food and Drug Administration (FDA) for the approval of oral once-daily baricitinib for the treatment of moderately-to-severely active rheumatoid arthritis (RA).

As a result, Incyte will receive a milestone payment of $35 million from Lilly related to the NDA submission. If baricitinib is granted US regulatory approval, Incyte will receive a milestone payment of $100 million from Lilly. Incyte could earn additional global regulatory as well as sales-based milestone payments and be eligible for royalties on global net sales of baricitinib.

If approved, Lilly will lead launch and global commercialisation efforts for baricitinib in RA. Lilly owns global rights to develop and commercialize baricitinib as an oral treatment for all inflammatory conditions.

This submission milestone will result in a first-quarter charge to Lilly's GAAP and non-GAAP research and development expense of $35 million (pre-tax). Lilly's previously-issued 2016 GAAP and non-GAAP EPS guidance of $2.92-$3.02 and $3.45-$3.55, respectively, remain unchanged.

"Lilly's collaboration with Incyte has produced a rigorous phase 3 program and, if approved, the potential of a promising new treatment option for people with RA," said David Ricks, president of Lilly Bio-Medicines.

Baricitinib is the only once-daily oral selective JAK1 and JAK2 inhibitor currently in late-stage clinical studies for inflammatory and autoimmune diseases. There are four known JAK enzymes: JAK1, JAK2, JAK3 and TYK2. JAK-dependent cytokines have been implicated in the pathogenesis of a number of inflammatory and autoimmune diseases, suggesting that JAK inhibitors may be useful for the treatment of a broad range of inflammatory conditions. Baricitinib demonstrates approximately 100-fold greater potency of inhibition against JAK1 and JAK2 than JAK 3 in kinase assays.

In December 2009, Lilly and Incyte announced an exclusive worldwide license and collaboration agreement for the development and commercialisation of baricitinib and certain follow-on compounds for patients with inflammatory and autoimmune diseases. Baricitinib is currently in phase 3 clinical development for rheumatoid arthritis and phase 2 development for psoriasis, diabetic nephropathy, atopic dermatitis and systemic lupus erythematosus.

Rheumatoid arthritis is an autoimmune disease characterized by inflammation and progressive destruction of joints. More than 23 million people worldwide suffer from RA. Approximately three times as many women as men have the disease. Patients and physicians indicate there remains an important opportunity to improve patient care. Current treatment of RA includes the use of non-steroidal anti-inflammatory drugs, oral disease-modifying anti-rheumatic drugs such as methotrexate, and injectable biological response modifiers that target selected mediators implicated in the pathogenesis of RA.

Lilly and Incyte have completed four pivotal phase 3 clinical trials of baricitinib in patients with moderately-to-severely active rheumatoid arthritis to support regulatory submission in most countries. An additional phase 3 study was initiated to support clinical development in China. The clinical trial programme includes a wide range of patients including those who are DMARD naïve, inadequate responders to methotrexate, inadequate responders to conventional disease-modifying anti-rheumatic drugs, or inadequate responders to biologic DMARDs. Patients completing any of the phase 3 studies can enroll in a long-term extension study.