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On Tuesday, Nektar stock jumped 156.3% to $24.45. In late morning trading on June 25, its stock was trading north of $33 per share. But behind the market euphoria lies a bitter legal tussle with former partner Eli Lilly over alleged data manipulation and sabotage, with the ongoing lawsuit creating uncertainties for Nektar’s path forward, according to an analysis of court and patent filings by Drug Discovery & Development.
KEY TAKEAWAYS
- Nektar’s stock soared 287% over five days on promising eczema trial results (61% efficacy)
- But a contentious lawsuit with former partner Eli Lilly casts shadow over the celebration
- Nektar claims Lilly sabotaged the drug through “botched math” and conflicts of interest
- Lilly counters that the drug failed on its merits and Nektar launched a false PR campaign
- Analyst targets jumped from $2-$60 to $69-$120
REZOLVE-AD primary endpoint results at week 16
The Phase 2b REZOLVE-AD study showed the drug achieved up to 61% improvement in eczema severity scores, positioning it as a potential challenger to Sanofi and Regeneron’s megablockbuster Dupixent.
The enthusiasm stems from what Nektar CEO Howard Robin calls “a new biology” in treating inflammatory skin disorders. Unlike existing treatments that simply block inflammatory pathways, rezpegaldesleukin actively proliferates regulatory T cells, a mechanism that showed dose-dependent efficacy across all three treatment arms:
REZOLVE-AD primary endpoint results at week 16
| Dose Group | EASI Improvement | EASI-75 Response | Itch Reduction* |
|---|---|---|---|
| High (24 µg/kg q2w) | 61% (p<0.001) | 42% | 42% (p<0.01) |
| Middle (18 µg/kg q2w) | 58% (p<0.001) | 46% | 35% (p<0.05) |
| Low (24 µg/kg q4w) | 53% (p<0.001) | 34% | 23% (ns) |
| Placebo | 31% | 17% | 16% |
Analyst price targets post-REZOLVE-AD results
The regulatory momentum for rezpegaldesleukin has accelerated considerably so far in 2025 after receiving FDA Fast Track designation on February 10. The company’s pipeline momentum continues with two data readouts on the horizon: Phase 2b results from the REZOLVE-AA study in alopecia areata expected in Q4 2025, followed by long-term maintenance data from the ongoing REZOLVE-AD study in Q1 2026.
Analyst price targets post-REZOLVE-AD results
| Analyst Firm | Previous Target | New Target | % Increase | Rating |
|---|---|---|---|---|
| H.C. Wainwright | $6.50 | $120 | +1,746% | Buy |
| Jefferies | $2.00 | $69 | +3,350% | Buy |
| BTIG | $60.00 | $100 | +67% | Buy |
Not in the table is William Blair, who maintained its cautious stance, noting rezpegaldesleukin’s “point of differentiation remains unclear” and viewing the stock surge as “valuation normalization.” Blair said that rezpeg appeared inferior to Dupixent in his opinion in terms of tolerability.
Legal complications behind the celebration
Yet while analysts rushed to upgrade targets, with BTIG jumping to $100 and Jefferies to $69, the company faces ongoing legal complexities from its dissolved partnership with Lilly. While patents filed in December 2022 remain jointly owned, a common outcome in pharmaceutical collaborations, Nektar maintains this does not restrict its ability to commercialize the drug independently under U.S. patent law.
The core of the Nektar vs. Lilly dispute
When asked for comment on the ongoing situation, a Lilly spokesperson provided a rebuttal to Nektar’s narrative: “The litigation between Lilly and Nektar remains ongoing, and we stand behind our decision to terminate the collaboration.”
This statement encapsulates a fundamental clash of narratives. Nektar claims a deliberate sabotage scheme, while Lilly argues it was grappling with a failed drug and a disingenuous partner. Here are their core arguments, drawn directly from court filings, all of which are available on archive.org.
A sabotage scheme or a failed drug?
Nektar’s accusation: A conflict of interest
“Lilly had a direct conflict of interest between its desire to develop lebrikizumab as an eczema drug and its contractual obligations to develop REZPEG… Lilly sought to eliminate this conflict… by taking steps to ensure REZPEG would never be developed at all.”
— Nektar’s First Amended Complaint (Doc. 61), p. 17, ¶ 51
Lilly’s ‘insufficient promise’ rebuttal
“REZPEG… showed insufficient promise as an immunology therapy to warrant further investment… trial results showed that REZPEG both failed its Phase 2 lupus trial… and caused injection site reactions or ‘ISRs’—red rashes that… could grow the size of grapefruits.”
To support this, Lilly’s filing presents detailed ISR data: 85-100% of healthy patients experienced injection site reactions, while 75% of atopic dermatitis patients and 71% of psoriasis patients developed ISRs described as red rashes “as large as tennis balls or even grapefruits” that lasted two weeks on average. “Some subjects experienced pain and itching in the same area,” it noted. The filing contrasts this with Dupixent’s 8-14% ISR rate, Lilly claimed.
— Lilly’s Counterclaims (Doc. 54), p. 10, ¶¶ 39-40
On the disputed clinical trial data
Nektar’s accusation of “botched math”
“Due to Lilly’s use of the Botched Math… its analysis significantly underreported REZPEG’s true efficacy… Lilly wrongly reported that REZPEG’s anti-eczema efficacy… was approximately 66%… Had Lilly used the correct EASI… [the] true anti-eczema efficacy… would have been shown to be approximately 83%.”
— Nektar’s First Amended Complaint (Doc. 61), pp. 15-16, ¶ 42 & 45-46
Lilly’s rebuttal: A third-party error blamed on Lilly
“While a calculation error occurred in the Phase 1 clinical trials, Lilly did not make that mistake. Rather, a third-party contract research organization (‘CRO’) that Nektar itself had recommended… made the error… Nektar was fully aware that these statements were false, given the CRO made the mistake.”
— Lilly’s Counterclaims (Doc. 54), p. 3, ¶ 8 & p. 19, ¶ 82
On financial harm and partnership termination
Nektar’s accusation: Lost milestone payments
“As a direct and proximate result of Lilly’s breaches… Nektar has been damaged, including by not receiving the Milestone Payments and royalty payments, and by Lilly not continuing to spearhead and fund REZPEG’s product development, in an amount to be proven at trial.”
— Nektar’s First Amended Complaint (Doc. 61), p. 31, ¶ 113
Lilly’s rebuttal: Nektar demanded termination and benefited
“Nektar also leveraged its false public statements to exert pressure on Lilly to terminate the Agreement. In March 2023, it demanded that Lilly terminate the License Agreement and return REZPEG to Nektar for development… As a result, Lilly agreed in April 2023 to give up all its rights in the treatment, without receiving anything in return, despite having invested $150 million to license REZPEG, as well as tens of millions more in research and development expenses. Lilly’s decision to return the asset to Nektar was a significant boon to Nektar because, if REZPEG proved successful, Nektar—as opposed to Lilly—would receive the payoff.”
— Lilly’s Counterclaims (Doc. 54), p. 3, ¶ 6
Timeline: how the partnership unraveled
Patent ownership and business implications
The drug’s development history with Lilly continues to cast a shadow over its commercial trajectory. Our analysis of patent filings reveals some patents covering rezpegaldesleukin’s dosing regimens remain jointly owned by both Nektar and its former partner Eli Lilly—a typical outcome when partnerships dissolve. The patent family (ID: 85157281), titled “Dosing regimens for selective treg stimulator rur20kd-il-2 and related compositions,” was filed in December 2022.
While joint patent ownership under U.S. law typically allows either party to commercialize independently, the ongoing lawsuit and operational dependencies create a complex business environment. In April 2023, Nektar stated that the termination wouldn’t impact its cash guidance, the original 2017 agreement included Nektar receiving “double-digit royalties that increase commensurate with their Phase 3 investment and product sales.”
With the drug targeting the $22.4 billion atopic dermatitis market projected by 2033, the optics of the acrimonious lawsuit—rather than the patent structure itself—could present challenges in securing future partnerships, though Nektar maintains its full rights to develop and commercialize the drug.
When asked about potential royalty obligations to Lilly or patent complications, a Nektar spokesperson maintained the company’s consistent position: all rights have returned to Nektar and it controls the intellectual property.
In its 2024 10-k annual report, Nektar wrote: “We developed rezpegaldesleukin and own full rights to this drug candidate. Although we previously entered into a license agreement with Eli Lilly and Company in 2017 (the Lilly Agreement) to develop and commercialize rezpegaldesleukin, on April 23, 2023, we received from Lilly a notice of at-will termination of the Lilly Agreement, and on April 27, 2023, we announced that we would be regaining full rights to rezpegaldesleukin.”
Contained in the same annual report under “Risks Related to our Collaboration Partners,” Nektar acknowledges potential risks: “[W]e are highly dependent on advancing rezpegaldesleukin in clinical trials, and while we believe we currently have the materials that are necessary for us to continue clinical development of rezpegaldesleukin, our ability to perform important development and regulatory activities will be significantly harmed if Eli Lilly and Company fails to continue to cooperate with us in the transfer of all materials associated with the rezpegaldesleukin program”
This line, repeated nearly verbatim in both the 2023 and 2024 10-K filings with the 2024 version adding “and regulatory” to the list of potentially harmed activities, highlights the operational friction at the heart of the dispute.
Lilly’s perspective, detailed in its March 29, 2024 counterclaim (Doc. 54), sheds further light on the issue. While affirming its cooperation, Lilly states that the trial data it must return “implicate confidentiality obligations… privilege and privacy rights of third parties.” This, the company asserts, requires “additional review and (potentially) redaction” before the materials can be fully transferred.
Complete patent filing records
The following table shows the key patent filings that remain under joint ownership between Nektar Therapeutics and Eli Lilly, covering rezpegaldesleukin’s dosing regimens across multiple jurisdictions. These patents, all stemming from the December 2022 filing (Family ID: 85157281), represent a typical outcome of dissolved pharmaceutical partnerships.
An overview of the patents
In April 2023, Nektar announced that it “will regain full rights to rezpegaldesleukin” and that it planned to launch a Phase 2b study then in patients with moderate-to-severe atopic dermatitis. A historical review of patent filing reveals the following:
| Publication number | Family ID | Filing date | Patent title | Assignee name |
|---|---|---|---|---|
| WO-2023114833-A1 | 85157281 | 20221214 | Schémas posologiques pour stimulateur treg sélectif, rur20kd-il-2, et compositions associées | LILLY CO ELI |
| WO-2023114833-A1 | 85157281 | 20221214 | Schémas posologiques pour stimulateur treg sélectif, rur20kd-il-2, et compositions associées | NEKTAR THERAPEUTICS |
| WO-2023114833-A1 | 85157281 | 20221214 | Dosing regimens for selective treg stimulator rur20kd-il-2 and related compositions | LILLY CO ELI |
| WO-2023114833-A1 | 85157281 | 20221214 | Dosing regimens for selective treg stimulator rur20kd-il-2 and related compositions | NEKTAR THERAPEUTICS |
| AU-2022414070-A1 | 85157281 | 20221214 | Dosing regimens for selective treg stimulator rur20kd-il-2 and related compositions | LILLY CO ELI |
| AU-2022414070-A1 | 85157281 | 20221214 | Dosing regimens for selective treg stimulator rur20kd-il-2 and related compositions | NEKTAR THERAPEUTICS |
| WO-2023114833-A9 | 85157281 | 20221214 | Dosing regimens for selective treg stimulator rur20kd-il-2 and related compositions | NEKTAR THERAPEUTICS |
| WO-2023114833-A9 | 85157281 | 20221214 | Dosing regimens for selective treg stimulator rur20kd-il-2 and related compositions | LILLY CO ELI |
| WO-2023114833-A9 | 85157281 | 20221214 | Schémas posologiques pour stimulateur treg sélectif, rur20kd-il-2, et compositions associées | NEKTAR THERAPEUTICS |
| WO-2023114833-A9 | 85157281 | 20221214 | Schémas posologiques pour stimulateur treg sélectif, rur20kd-il-2, et compositions associées | LILLY CO ELI |
| EP-4447995-A1 | 85157281 | 20221214 | Dosierschemata für selektiven treg-stimulator rur20kd-il-2 und zugehörige zusammensetzungen | NEKTAR THERAPEUTICS |
| EP-4447995-A1 | 85157281 | 20221214 | Dosierschemata für selektiven treg-stimulator rur20kd-il-2 und zugehörige zusammensetzungen | LILLY CO ELI |
| EP-4447995-A1 | 85157281 | 20221214 | Dosing regimens for selective treg stimulator rur20kd-il-2 and related compositions | NEKTAR THERAPEUTICS |
| EP-4447995-A1 | 85157281 | 20221214 | Dosing regimens for selective treg stimulator rur20kd-il-2 and related compositions | LILLY CO ELI |
| EP-4447995-A1 | 85157281 | 20221214 | Schémas posologiques pour stimulateur treg sélectif, rur20kd-il-2, et compositions associées | NEKTAR THERAPEUTICS |
| EP-4447995-A1 | 85157281 | 20221214 | Schémas posologiques pour stimulateur treg sélectif, rur20kd-il-2, et compositions associées | LILLY CO ELI |
| MX-2024007345-A | 85157281 | 20221214 | Pautas posologicas para el estimulador de treg selectivo rur20kd-il-2 y composiciones relacionadas. | NEKTAR THERAPEUTICS |
| MX-2024007345-A | 85157281 | 20221214 | Dosing regimens for selective treg stimulator rur20kd-il-2 and related compositions. | NEKTAR THERAPEUTICS |
| CA-3239501-A1 | 85157281 | 20221214 | Dosing regimens for selective treg stimulator rur20kd-il-2 and related compositions | NEKTAR THERAPEUTICS |
| CA-3239501-A1 | 85157281 | 20221214 | Dosing regimens for selective treg stimulator rur20kd-il-2 and related compositions | LILLY CO ELI |
| CA-3239501-A1 | 85157281 | 20221214 | Schemas posologiques pour stimulateur treg selectif, rur20kd-il-2, et compositions associees | NEKTAR THERAPEUTICS |
| CA-3239501-A1 | 85157281 | 20221214 | Schemas posologiques pour stimulateur treg selectif, rur20kd-il-2, et compositions associees | LILLY CO ELI |
| AR-127946-A1 | 90556543 | 20221213 | ESTIMULADOR TREG SELECTIVO RUR₂₀ₖD-IL-2 Y COMPOSICIONES RELACIONADAS | LILLY CO ELI |
| AR-127946-A1 | 90556543 | 20221213 | ESTIMULADOR TREG SELECTIVO RUR₂₀ₖD-IL-2 Y COMPOSICIONES RELACIONADAS | NEKTAR THERAPEUTICS |
| CN-118475363-A | 92159498 | 20221214 | Dosing regimen for selective TREG stimulators RUR20KD-IL-2 and related compositions | LILLY CO ELI |
| CN-118475363-A | 92159498 | 20221214 | Dosing regimen for selective TREG stimulators RUR20KD-IL-2 and related compositions | NEKTAR THERAPEUTICS |
| CN-118475363-A | 92159498 | 20221214 | 选择性treg刺激剂rur20kd-il-2及相关组合物的给药方案 | LILLY CO ELI |
| CN-118475363-A | 92159498 | 20221214 | 选择性treg刺激剂rur20kd-il-2及相关组合物的给药方案 | NEKTAR THERAPEUTICS |
How the patent data was collected: The patent ownership data presented in this article was compiled through a custom query of the Google Patents Public Datasets on the Google BigQuery platform, which draws data from IFI Claims. The analysis identified the listed legal assignees for all global patents and applications related to “rezpegaldesleukin” or “NKTR-358.”
Correction (June 26, 2025): This article has been updated to clarify the nature of the joint patent ownership between Nektar and Lilly. While the patents remain jointly owned, Nektar has clarified that under U.S. patent law and the terms of their license agreement, this joint ownership does not restrict either party’s ability to independently develop or commercialize rezpegaldesleukin. The article has been revised to more accurately reflect that the primary commercial considerations stem from the ongoing lawsuit and operational transition matters, rather than the patent ownership structure itself.
Filed Under: Biologics, clinical trials, Dermatology, Immunology
