CHF 10 million milestone recognizes development progress - Updated financial terms add a new CHF 60 million milestone for Phase 2 initiation - Total potential deal value is now CHF 1.86 billion, up from CHF 1.82 billion

AC Immune SA (NASDAQ: ACIU), a Swiss-based, clinical-stage biopharmaceutical company, today announced that it will receive a second milestone payment of CHF 10 million from Eli Lilly and Company on or before March 31, 2020 related to development progress in the small molecule Morphomer Tau  aggregation inhibitor program.

The multi-year collaboration agreement between Lilly and AC Immune was originally announced in December 2018 and focuses on the broad development of Morphomer Tau aggregation inhibitors for Alzheimer’s disease (AD) and other neurodegenerative diseases.

The second milestone payment of CHF 10 million marks significant progress between the companies in just 15 months. In that time, ACI-3024, a first-in-class investigational oral small molecule Tau Morphome for treatment of Alzheimer’s disease (AD) and other neurodegenerative disorders, has advanced from preclinical into Phase 1 clinical development. Lilly made a first milestone payment of CHF 30 million in September 2019.

Under the updated collaboration terms, AC Immune will now also be eligible for a new CHF 60 million potential milestone after initiation of Tau Morphomer Phase 2 clinical testing. No additional changes were made to other later-stage milestones or royalty terms.

Prof. Andrea Pfeifer, CEO of AC Immune SA, commented: “This new Phase 2 milestone was not included previously in the agreement and its addition increases the total deal value and offers a new significant potential source of medium-term non-dilutive financing. This reflects the progress achieved in this transformative partnership with Lilly, who is an industry leader in Alzheimer’s research, and our confidence in the partnership’s potential to make a major contribution to treating this devastating disease and to create shareholder value.”

Tau is a high priority therapeutic target in the complex treatment paradigm for AD and ACI-3024 is the most advanced orally available small molecule therapeutic candidate of its kind in development. ACI-3024’s proposed unique mechanism of action targets both intracellular and extracellular Tau aggregates, potentially slowing or stopping the accumulation and propagation of pathological Tau aggregates in AD patients. Compared to other Tau-targeting molecules in development, the key potential differentiating factor is that ACI-3024 has been shown to act intracellularly to address specifically Tau pathology at an early stage.

ACI-3024 is the lead molecule, discovered by AC Immune and being developed within the license and collaboration agreement between AC Immune and Lilly to research and develop small molecule Tau Morphomer aggregation inhibitors for the treatment of AD and other neurodegenerative diseases. The collaboration combines AC Immune’s proprietary Morphomer discovery platform technology and early development experience with Lilly’s established clinical development expertise and commercial capabilities in central nervous system disorders. Under the agreement AC Immune is conducting the initial Phase 1 development of ACI-3024 while Lilly will fund and conduct further clinical development.The Phase 1 trial initiated in July 2019 is a randomized, placebo-controlled, double-blind, sequential single and multiple ascending dose study that aims to assess the safety, tolerability, pharmacokinetics, and pharmacodynamics of ACI-3024 in healthy volunteers. Data from the study may be communicated as soon as the second half of 2020, at the discretion of Lilly.