Sangamo Therapeutics, Inc., a genomic medicine company, signed an evaluation and option agreement with Prevail Therapeutics, a wholly owned subsidiary of Eli Lilly and Co., granting Prevail rights to evaluate certain adeno-associated virus (AAV) capsids developed by Sangamo and may exercise certain options to license these capsids for multiple undisclosed neurological targets.

Generated through Sangamo’s AAV capsid engineering platform, SIFTER (Selecting In vivo For Transduction and Expression of RNA), these capsids have demonstrated a potential for high efficiency delivery of investigatory gene therapy constructs to the central nervous system in preclinical animal models following administration into the cerebrospinal fluid and seek to optimize delivery of therapeutics to a range of previously inaccessible areas.

Sangamo will provide the capsids to Prevail for evaluation in exchange for an upfront payment. If Prevail exercises its option for all targets, and a Prevail product is approved in the U.S. and Europe for each target, Sangamo would be eligible to receive exercise fees and developmental milestones of up to approximately $415 million and commercial milestones of up to approximately $775 million, in addition to royalties on  sales. Prevail would lead all further development, manufacturing and commercialization of products incorporating the licensed capsids.

“We believe these innovative new capsids have the potential to broaden addressable indications in the field of genomic medicines, opening up potential new treatment options for patients in need,” said Mark McClung, chief operating officer at Sangamo. “This agreement highlights the value of our AAV capsid engineering program, not only for the discovery of novel capsids for the advancement of our wholly owned programs, but also as an opportunity to work with partners to broaden the scope of diseases addressable with AAV gene therapy. We are thrilled to work with Prevail to evaluate our novel capsids for neurological targets and are pleased that other genomic medicine companies recognize their potential value.”