Eli Lilly has stepped up its diabetes armamentarium with the signing of a licensing deal with Japan’s Taisho Pharmaceutical for TS-021, an oral compound currently in Phase I clinical development for the treatment of type 2 diabetes.

Under the terms of the agreement, Lilly has acquired exclusive worldwide rights to develop and commercialise TS-021, excluding Japan and China. Taisho will manufacture the bulk active ingredient of TS-021 for Lilly, and may also co-promote the compound in the US and other designated countries under certain circumstances.

The firms say that TS-021’s mechanism of action differs from currently available diabetes treatments. It works by inhibiting an enzyme that breaks down the human hormone that is key to maintaining glucose levels.

Lilly’s diabetes franchise currently includes Humalog (insulin lispro), and Actos (pioglitazon), and the firm recently won the US nod for Byetta (exenatide) – albeit in a more limited indication than had originally been hoped [[03/05/05d]].