Memorandum

Lilly teams up with MIT spin-out Sigilon Therapeutics to develop beta cell encapsulation therapy for type 1 diabetes – April 6, 2018

    Executive Highlights

    • Lilly just announced a collaboration with MIT spin-out Sigilon Therapeutics to develop a beta cell encapsulation therapy for type 1 diabetes. Lilly will pay $63 million upfront to license Sigilon’s Afibromer technology (a material that protects implanted devices or cells from foreign body response), and will also make an undisclosed equity investment in Sigilon. Under the terms of the agreement, Sigilon is responsible for all preclinical R&D and associated costs, while Lilly will take over once an IND has been submitted to FDA. Sigilon is also eligible for up to $410 million in milestones as well as tiered royalties on future sales if the collaboration yields a commercial product.

    • Afibromer is particularly intriguing tech because foreign body response has been a major challenge to beta cell encapsulation efforts thus far. As part of preclinical work, Sigilon will fine-tune the Afibromer coating for an encapsulation device, and will also continue developing a stem cell line that can be differentiated into insulin-producing beta cells. A proof-of-concept study published in 2016 showed efficacy in a mouse model of type 1 diabetes – after 174 days, cells housed inside the device were still sensing glucose and secreting insulin, there was no need for immunosuppressive concomitant therapy, and there was no substantial effect of foreign body response on the device.

    Lilly announced an exciting new partnership this week with MIT spin-out Sigilon Therapeutics – the two will collaborate to develop a beta cell encapsulation therapy for type 1 diabetes. Lilly has paid $63 million so far to license Sigilon’s proprietary Afibromer technology, a “superbiocompatible” material that protects implanted devices or cells from foreign body response (FBR). According to the joint announcement, Lilly will make an undisclosed equity investment in Sigilon in addition to the $63 million upfront payment. Sigilon is eligible for up to $410 million in development and commercial milestones, and could also receive tiered royalties on future sales if this collaboration yields a commercial product. Until then, Sigilon is responsible for all preclinical development and costs. Once an Investigational New Drug Application (IND) has been filed, Lilly will take over all development and costs for in-human trials.

    Of the many challenges to beta cell encapsulation, circumventing FBR has been particularly high-profile. For example, ViaCyte decided to de-prioritize its ambitious phase 1/2 PEC-Encap (encapsulated beta cells) in favor of PEC-Direct (which requires chronic immunosuppression) and PEC-QT (immune-evasive stem cells that don’t trigger FBR) due to technical challenges and FBR surrounding the implanted encapsulation device. Afibromer technology is especially intriguing in this context, and part of Sigilon’s preclinical work will involve fine-tuning the Afibromer coating around the encapsulation device to house cells (we heard about a prototype at GTC Diabetes Summit 2017).

    Sigilon will also continue developing a stem cell line that can be differentiated into insulin-producing beta cells once inside the body.

    With this collaboration, Lilly enters the early-stage type 1 prevention and cures competitive landscape, and we see the company’s support as a vote of confidence for beta cell encapsulation technology in principle – to-date, this area of R&D has been dominated by small biotechs.

    Sigilon’s technology has been the subject of great interest in the broader medical device field (much more on this below), and we’re very moved to see that its clinical debut may occur in diabetes.

    Other candidates in the beta cell encapsulation competitive landscape include ViaCyte’s PEC-Encap and PEC-Direct as well as Sernova’s phase 1/2 Cell Pouch System (a microencapsulation technique that combines beta cells with local immune protection technology). See our competitive landscape for more details, and for a list of preclinical beta cell encapsulation projects.

    Background on Sigilon’s Afibromer Technology

    • A 2016 Nature Medicine paper detailed proof-of-concept for an early version of Sigilon’s beta cell encapsulation system in a mouse model of type 1 diabetes. Insulin-producing beta cells derived from human stem cells (from Dr. Doug Melton’s protocol, now proprietary material of Semma Therapeutics) were encapsulated in Sigilon’s FBR-protective Afibromer device. When implanted into a mouse model of type 1 diabetes with a functioning immune system, the cells successfully produced insulin and normalized glucose for 174 days with no immunosuppressive therapies. At the end of the study, the devices still contained viable insulin-producing cells, suggesting that the alginate encapsulation device did not fall victim to fibrosis from FBR (at least over the 174-day study duration). It’s unclear whether Sigilon will use this prototype as the basis of its Lilly-partnered encapsulation system for human use, or whether the company will instead engineer its own stem cell line. The Afibromer platform was born from the MIT laboratories of Drs. Bob Langer and Dan Anderson.

    • At the 2017 GTC Diabetes Summit, Sigilon’s Dr. Omid Veiseh (Founding Scientist & Head of Innovation) shared unpublished data from an ongoing study in non-human primates that provides a head-to-head comparison of Sigilon’s beta cell encapsulation technology vs. traditional encapsulation systems. Four months after implantation, Sigilon capsules were completely fibrosis-free, a “night and day difference” vs. the comparison capsule, which was covered in fibrous deposition to the point of non-functionality. Meanwhile, the beta cells inside the Sigilon capsules were 90% viable and still able to sense blood glucose and secrete insulin. The group has also demonstrated that the Sigilon encapsulation system is safe and hospitable for a variety of beta cell sources (whether from stem cells, cadaveric donors, etc.), with no adverse reactions observed thus far. Dr. Veiseh noted at GTC 2017 that the company is optimistic about creating a human islet encapsulation system that arrests the symptoms of type 1 diabetes for up to a year with a single implantation procedure.

    • Sigilon’s FBR-evasive Afibromer technology has implications for virtually any kind of implanted medical device. In the context of diabetes, beyond beta cell encapsulation, we also see possible applications for CGM, insulin pumps, and Intarcia’s implantable exenatide mini pump – could Afibromer material make for a better patient experience with a device on the body, or allow for a device that’s implanted for longer with reduced risk of infusion site occlusions? Excitement aside, it’s important to bear in mind that Sigilon’s technology has yet to be evaluated in humans.

     

    -- by Abigail Dove, Payal Marathe, and Kelly Close