Incyte Licenses Drug to Eli Lilly

WILMINGTON, Del. (TheStreet) -- Incyte(INCY) announced Monday that it has licensed a mid-stage rheumatoid arthritis drug to Eli Lilly(LLY).

Under terms of the agreement, Lilly is paying $90 million upfront to Incyte for development and marketing rights to INCB28050, which is currently in a phase II study for rheumatoid arthritis.

Incyte will also be eligible for an additional $665 million in potential milestone payments from Lilly and double-digit royalties on the drug's global sales, if approved.

The partnership between the two companies encompasses INCB28050 and certain follow-on compounds which may be developed for other autoimmune and anti-inflammatory diseases.

As a result of this transaction, Lilly expects to incur a charge to earnings in the fourth quarter of approximately 5 cents per share. The company reconfirmed its full-year 2009 earnings guidance of $3.90 to $4.00 per share on a reported basis, or $4.30 to $4.40 per share on a pro forma basis.

INCB28050 is an oral drug that inhibits JAK1 and JAK2 -- two enzymes thought to play a role in the course of rheumatoid arthritis and other inflammatory/autoimmune diseases.

Incyte's lead JAK inhibitor, INCB18424, is in Phase III development for myelofibrosis.

Pfizer Licenses Athersys Stem-Cell Drug

(At 6:46 AM EST)

Pfizer(PFE) said Monday it has licensed a stem cell therapy for inflammatory bowel disease from Athersys(ATHX).

Athersys will received $6 million upfront from Pfizer and is eligible for another $105 million in future milestone payments. Pfizer is paying the costs to develop the stem cell therapy, known as MultiStem, for inflammatory bowel disease.