Peptone nears end of two-year Lilly technology evaluation…follow-on deal could be pivotal

Industry attention is focused on whether Peptone will secure a follow-on deal as its technology evaluation agreement with Eli Lilly for a long-acting drug delivery platform is set to expire on the 7th.

On Oct. 7, 2024, Peptone signed a joint research and technology evaluation agreement with Lilly to apply its proprietary SmartDepot drug delivery system platform to Lilly’s peptide drugs. The evaluation period, initially about 14 months, was extended to as long as 24 months as research deepened and additional data were validated. The deadline falls on the 7th of this month.

Peptone said the 7th does not represent a final deadline for signing a definitive technology transfer agreement. The date relates to the basic term of the current joint research and technology evaluation agreement, and the company said discussions and reviews of follow-on collaboration and commercial agreements may continue after the joint research ends.

However, industry observers believe that, after two years of technical feasibility testing, the 7th could bring a signal about the partnership’s direction, such as a technology transfer, the start of definitive agreement negotiations, another extension of the evaluation period or the end of the collaboration.

Before then, Peptone substantially strengthened its intellectual property portfolio for long-acting formulations in obesity and metabolic diseases. The company disclosed on the 1st that it had received a decision to grant Korean patents for extended-release formulation technology designed to provide long-term release of glucagon-like peptide-1 (GLP-1) drugs, including semaglutide and tirzepatide.

The patented technology makes microspheres by mixing biodegradable polymer compounds of a specific viscosity at an optimized ratio, suppressing excessive initial drug release and maintaining uniform release concentrations over an extended period. Peptone has built its core pipeline around PT403, a once-monthly formulation candidate based on semaglutide, the active ingredient in Novo Nordisk’s Wegovy, and PT404, a long-acting formulation based on tirzepatide, the active ingredient in Lilly’s Mounjaro and Zepbound.

The tirzepatide patent registration, in particular, is seen as helping resolve market confusion that arose in July. At the time, comments by Peptone CEO Choi Ho-il prompted widespread interpretation that tirzepatide had been excluded from the joint research with Lilly. In a letter to shareholders, Peptone said it could not identify the specific compounds under evaluation because of contractual confidentiality obligations, but clarified that normal research was being conducted on multiple compounds, including next-generation obesity and diabetes candidates and central nervous system drugs held by Lilly.

The company expects to gain an advantage in future global partnering, as it has also filed for patents in major overseas markets, including the United States and Europe, where the applications are under review.

The importance of drug delivery systems is growing in global markets. Peptide-based drugs, which currently lead obesity treatment, have short half-lives, requiring patients to self-administer subcutaneous injections every week. Extending the dosing interval to once a month or longer could improve adherence and reduce gastrointestinal adverse effects, such as nausea and vomiting, caused by a rapid rise in blood concentrations early in treatment.

Global pharmaceutical companies are therefore expanding collaborations with platform companies that have long-acting formulation technologies. Lilly’s two-year technology evaluation with Peptone, alongside its multitrack strategy of adopting Camurus’ fluid crystal technology for multiple candidates, reflects the same trend.

Competition among domestic drug delivery system companies for collaborations with major pharmaceutical companies is also intense. After joint research on long-acting peptide injections with Germany’s Boehringer Ingelheim, Inventage Lab signed a material transfer agreement and entered the in vivo pharmacokinetic testing stage. G2GBIO has also signed two formulation development agreements with Boehringer Ingelheim, completed formulation development in April and is conducting large-animal evaluations.

All of these companies are continuing formulation design and preclinical validation using candidate compounds received from global pharmaceutical companies. But after undergoing the longest evaluation period, at two years, Peptone is the closest to reaching the final commercialization milestone.

Peptone is also moving to develop overseas markets as its technology evaluation with Lilly concludes. The company will attend CPHI, a global pharmaceutical industry exhibition taking place in Milan, Italy, from the 6th to the 8th, to promote its SmartDepot platform and develop global sales channels for Lupron One, a prostate cancer treatment that received Korean marketing approval in 2025.

Lupron One, a one-month leuprolide formulation, is tangible evidence that the SmartDepot platform has completed the full process from preclinical and clinical development through regulatory approval and large-scale commercial production. At the event, Peptone plans to hold partnering meetings with global pharmaceutical companies from Latin America, the Middle East and Europe to discuss overseas licensing rights for Lupron One and joint development of new compounds.

Clinical development of the company’s proprietary pipeline is also gaining momentum. PT403, a once-monthly obesity treatment candidate based on semaglutide, was recently submitted to the Ministry of Food and Drug Safety for a phase 1 clinical trial, and the approval process is underway. The company is also proceeding as planned with construction of its second injectable drug manufacturing plant in Osong, North Chungcheong Province, to expand its capacity to supply clinical and commercial materials at scale in preparation for future global commercialization agreements.

Experts say that global pharmaceutical companies make decisions through a rigorous and conservative process, so a time lag between the end of a technology evaluation and the signing of a definitive agreement is common. They also cautioned that contractual confidentiality provisions can make it difficult to disclose details while negotiations are underway.

Accordingly, Peptone’s proprietary patent portfolio, approval and data from PT403’s phase 1 trial, and diversified global partnering through CPHI are expected to work together to demonstrate the company’s fundamentals. After two years of waiting, attention is focused on whether Peptone can achieve commercialization of its long-acting drug delivery platform this October.