China-based Yabao Pharmaceutical Co. Inc. has entered a second strategic collaboration for the treatment of diabetes with Eli Lilly and Company to co-develop Lilly’s sodium-glucose linked transporter inhibitor (SGLT1) molecule. Lilly’s SGLT1 inhibitor program has completed a Phase I study in Singapore, in addition to extensive pre-clinical development. In July 2014, Lilly and Yabao also announced the co-development of Lilly’s glucokinase activator (GKA), LY2608204.

Diabetes is a disease of great unmet need in China and worldwide. Inhibition of intestinal SGLT1 is a promising therapeutic approach because it acts independently of the beta cell and may therefore be effective in both early-stage and advanced diabetes. The reduction in both glucose and insulin may improve the metabolic state and potentially the health of the beta cells in the absence of body weight gain or hypoglycemia. Its complementary mechanism could be effective when used in combination with other important diabetes drugs.

Under the terms of the agreement, Yabao receives the rights to develop and commercialize the SGLT1 compound in China, while Lilly retains rights in all other markets. The parties will collaborate to determine a strategic development plan for China, and Yabao will initially be responsible to perform and fund all development. Lilly retains future buy-in options for China. Financial terms were not disclosed.

“Lilly’s SGLT1 Inhibitor program is based on a mechanistic understanding and chemistry approach that has the potential to enable the development of a best-in-class agent. Yabao is again pleased to be collaborating with Lilly, a global leader in diabetes, on our second strategic collaboration, which demonstrates our joint commitment to diabetes patients in China,” said Peng Wang, president R&D, Yabao Pharmaceutical. “This collaboration is also another example of Yabao’s continued commitment to collaborate and develop promising science in China.”