Lilly to Acquire Avid Radiopharmaceuticals

INDIANAPOLIS and PHILADELPHIA, Nov. 8, 2010 /PRNewswire-FirstCall/ — Eli Lilly

and Company (NYSE: LLY) today announced that it has signed a definitive merger
agreement to acquire Avid Radiopharmaceuticals, Inc., a privately held company
developing novel molecular imaging compounds intended for the detection and
monitoring of chronic human diseases. Avid’s lead program in development is
florbetapir F 18 (18F-AV-45), a molecular imaging agent under investigation for
detecting the presence of amyloid plaque in the brain. Beta-amyloid plaque is a
defining pathology of Alzheimer’s disease. A marketing application for
florbetapir has recently been submitted to the U.S. Food and Drug Administration
(FDA). The acquisition of Avid also provides Lilly with a diagnostics
development platform covering several disease areas, including Parkinson’s
disease and diabetes.

“The acquisition of Avid Radiopharmaceuticals aligns well with Lilly’s
innovation-based strategy, offers a potential near-term revenue opportunity,
leverages our neuroscience expertise and will immediately bolster our
diagnostics capabilities,” said John Lechleiter, Ph.D., Lilly chairman and chief
executive officer. “We look forward to partnering with Avid’s experts during the
regulatory process for florbetapir, and are intent on gaining FDA approval for
this promising diagnostic intended to help clinicians and researchers identify
the presence of beta-amyloid plaque in the brain.”

“We are very excited to join the great scientific team at Lilly and continue our
work to develop new molecular imaging agents capable of changing the medical
management of significant chronic human diseases,” said Daniel M. Skovronsky,
M.D., Ph.D., Avid’s founder and chief executive officer. “We’ve had a productive
and long-standing relationship with Lilly, and believe in their approach to
providing improved outcomes for individual patients.”

Under the terms of the agreement, Lilly will acquire all outstanding shares of
Avid for an upfront payment of $300 million, subject to adjustment based on
existing cash on hand at closing. Avid stockholders will also be eligible for up
to $500 million in additional payments contingent upon potential future
regulatory and commercial milestones for florbetapir. Upon completion of the
acquisition, Avid will continue to operate from its facility in Philadelphia,
Pennsylvania. Avid will provide uninterrupted support for ongoing academic
clinical trials, including the Alzheimer’s Disease Neuroimaging Initiative
(ADNI), as well as ongoing clinical trials for other pharmaceutical companies.
The transaction is contingent upon clearance under the Hart-Scott-Rodino
Antitrust Improvements Act and other customary closing conditions, including
requisite approval of Avid stockholders. Barclays Capital served as exclusive
financial advisor to Lilly, while Morgan Stanley & Co. Incorporated served as
exclusive financial advisor to Avid.

“The acquisition of Avid supports our efforts to provide patients and physicians
with diagnostics that enable speed of intervention, improve diagnosis accuracy
and inform therapeutic choice,” said Tiffany Olson, Lilly’s vice president of
diagnostics research and development. “In addition to florbetapir, we look
forward to supporting the continued clinical development of Avid’s earlier-phase
diagnostics pipeline.”

About Alzheimer’s disease

Alzheimer’s disease is a chronic neurodegenerative condition that currently
affects over 5 million Americans. Alzheimer’s is a fatal form of dementia that
causes progressive decline in memory and other aspects of cognition. It occurs
when neurons in the brain begin dying prematurely. Researchers do not know
exactly what causes Alzheimer’s, but one hypothesis is that the amyloid beta
protein plays an important role. Currently, Alzheimer’s disease cannot be
definitively diagnosed until after death, when a brain autopsy is performed.
Accurate diagnosis during life can be challenging.

About florbetapir

Florbetapir, used with positron emission tomography (PET) technology is being
assessed for the ability to detect beta-amyloid plaque deposits in living
patients. Florbetapir was the first beta-amyloid imaging compound to enter
multi-center, IND clinical studies in the U.S., and has now been studied in more
than a dozen trials in over 700 subjects ranging from cognitively normal
individuals to those with Alzheimer’s dementia. In addition to the pivotal Phase
III Image-to-Autopsy study, other clinical studies are also being conducted in
the E.U., North and South America, Australia and Asia.

About Avid Radiopharmaceuticals, Inc.

Avid Radiopharmaceuticals is a leader in the development of molecular imaging
products with the potential for more effective detection, diagnosis and
monitoring of major chronic human diseases. Based in Philadelphia, PA, the
company is a pioneer in the development of molecular imaging. In addition to
florbetapir, Avid is currently conducting Phase I and II trials with 18F-AV-133
for imaging the vesicular monoamine transporter (VMAT2) in diseases involving
dopaminergic degeneration (Parkinson’s disease and Dementia with Lewy Bodies)
and beta cell dysfunction (Type I and Type II Diabetes Mellitus). More
information about Avid is available at www.avidrp.com.

About Eli Lilly and Company

Lilly, a leading innovation-driven corporation, is developing a growing
portfolio of pharmaceutical products by applying the latest research from its
own worldwide laboratories and from collaborations with eminent scientific
organizations. Headquartered in Indianapolis, Ind., Lilly provides answers -
through medicines and information – for some of the world’s most urgent medical
needs. Additional information about Lilly is available at www.lilly.com. C-LLY

This press release contains forward-looking statements about the benefits of a
merger between Lilly and Avid and the potential of Avid’s product pipeline. It
reflects Lilly’s and Avid’s current beliefs, assuming that the transaction is
successfully closed; however, as with any such undertaking, there are
substantial risks and uncertainties in the process of implementing the
transaction and in drug development. There is no guarantee that the merger will
close, that Lilly will realize the expected benefits of the transaction, or that
florbetapir will be approved by the FDA on the anticipated timeline or at all,
that florbetapir will be commercially successful, or that Avid’s pipeline will
yield commercially successful diagnostic radiopharmaceutical products. For
further discussion of these and other risks and uncertainties, please see
Lilly’s latest Forms 10-Q and 10-K filed with the U.S. Securities and Exchange
Commission. The companies undertake no duty to update forward-looking
statements.

SOURCE Eli Lilly and Company