INDIANAPOLIS (AP) -- Drugmaker Eli Lilly and Co. will spend up to $800 million to buy Avid Radiopharmaceuticals, a development-stage company that created an agent that may help diagnose Alzheimer's disease.
The Indianapolis company said Monday the privately held Philadelphia company has no products on the market. But it is seeking Food and Drug Administration approval for florbetapir, an injectable agent used to detect amyloid plaque in the brain.
This plaque is an indicator of Alzheimer's disease, a fatal form of dementia that occurs when brain neurons die prematurely. Alzheimer's causes progressive memory decline and has no cure. Scientists aren't even sure what causes the disease.
Drugs on the market that treat it only temporarily alleviate symptoms.
Florbetapir is an imaging agent injected into patients who are then put through a positron emission tomography scan to detect the plaque.
Currently, the only way to accurately diagnose the presence of plaque in the brain is to wait until death and then perform an autopsy, Lilly spokesman Mark Taylor said.
Lilly will pay $300 million upfront for the company and up to $500 million in additional payments if the agent meets some regulatory and commercial milestones. The company did not offer a potential closing date in a statement announcing the deal.
Avid also is developing diagnostic agents for other areas, including Parkinson's disease and diabetes.
Lilly has worked with Avid, and its venture capital organization has had an equity stake in the company since 2005, Taylor said.
Lilly has a potential Alzheimer's treatment in late-stage testing and others under development.
The drugmaker also said in August it would stop developing the potential Alzheimer's treatment semagacestat after preliminary results from late-stage studies showed it did not slow the disease's progression, and patients taking the drug actually fared worse than those on a placebo.
Lilly has been supplementing its pipeline of drugs under development with some acquisitions as it nears the expiration of patents protecting some of its best-selling drugs. That list includes the company's top-seller, the anti-psychotic Zyprexa, which loses protection next year.
In a separate statement, Safeguard Scientifics Inc. said it has a 13 percent primary ownership position in Avid and expects to receive minimum net sale proceeds of about $36 million.
Shares of Lilly climbed 5 cents to $35.77 in Monday morning trading, while Safeguard shares climbed 61 cents, or 4 percent, to $15.70.