Nearly two years after buying Prevail Therapeutics, Eli Lilly is doubling down on its gene therapy presence through the acquisition of Akouos.

Eli Lilly will pay $12.50 a share for Boston, Massachusetts-based Akouos, equating to around $487 million. The Big Pharma firm could pay a further one contingent value right (CVR) of up to $3 per share, adding another $123 million to the deal.

Akouos is developing gene therapies to address hearing loss conditions, with its lead candidate AK-OTOF set to enter clinical trials as a potential restorer of hearing in individuals with sensorineural hearing loss due to mutations in the otoferlin (OTOF) gene.

Photo by Alexander Mils on Unsplash

The anatomy of the inner ear presents challenges for adeno-associated virus (AAV) gene therapy delivery, while the vector also has a limited capacity for carrying a genetic payload.

To overcome those limitations, Akouos uses synthetic AAVs that recreate naturally occurring viruses called ancestral AAVs, which the company says can reach the target in the ear. Furthermore, the company uses a ‘dual vector’ approach that employs two engineered viruses, each carrying a fragment of the OTOF gene. The Akouos approach to gene therapy is based on the research of Luk Vandenberge, director of the Grousbeck Gene Therapy Center in Boston and a professor at Harvard Medical School.

The vectors are produced by contract development and manufacturing organization (CDMO) Lonza after the firms struck a strategic agreement in 2017.

For Lilly, the acquisitions builds on its position in the burgeoning gene therapy space, following the $880 million acquisition of Prevail Therapeutics, announced in December 2020 and closing the following month.

“Gene therapy offers tremendous opportunity to provide durable treatments for patients with genetically defined disease; this is our second acquisition in gene therapy, following the 2021 acquisition of Prevail Therapeutics,” said Daniel Skovronsky, Lilly’s chief scientific and medical officer, and president of Lilly Research Laboratories.

“With Akouos, we are optimistic that we can make a difference for people with hearing loss and other inner ear conditions.”