Eli Lilly and Company has entered into a research collaboration and license agreement with biotechnology firm Biolojic Design to discover and develop a new antibody-based therapy for diabetes.

Under the terms of the agreement, Biolojic is eligible to receive up to a total of $121m, including potential development and commercialisation milestones.

Lilly will pay research fees related to the collaboration and issue a promissory note that can be converted into Biolojic equity in the future.

Also, Biolojic is entitled to receive tiered royalties on the product sales, based on Lilly commercialising a therapy from the collaboration.

Lilly diabetes and metabolic research vice president Ruth Gimeno said: “Lilly continues to seek out novel methods for developing new medicines, and Biolojic’s multi-specific antibody platform is a promising approach.

“We look forward to working closely with the scientific team at Biolojic and leveraging their expertise to discover and develop a potential antibody-based therapy for people with diabetes.”

The partnership will leverage Biolojic’s AI-based multi-body platform. Multi-specific antibody, or multibody, is a human antibody engineered to bind two or more targets.

The dual-target mechanism of the multibody platform enables the production of therapies with different activities, which may vary based on tissue localisation and metabolic parameters, said Lilly.

The transaction will be reflected in Lilly’s reported results and financial guidance according to Generally Accepted Accounting Principles (GAAP).

Biolojic CEO Yanay Ofran said: “Our AI-based platform designs single and multi-specific antibodies, or multibodies, that we believe can precisely target predefined epitopes to potentially execute novel biological programs not previously possible with conventional antibodies.

“Although our internal pipeline is focused on computationally designed antibodies for use in oncology and autoimmune disease, we are excited to partner with Lilly and apply our platform to design potential therapies for diabetes.

“Our research with Lilly is another example of how our platform could allow reimagining of therapeutic approaches that have not been possible before.”

Biolojic Design is engaged in designing and developing a pipeline of revolutionary therapeutics, by leveraging AI-powered technology.

The company designs single and multi-specific antibodies that precisely target predefined epitopes to execute novel biological programmes, focusing on diseases of the immune system.