Eli Lilly (LLY) has entered into a research and collaboration agreement with BioArctic to develop a potential neurodegenerative disease treatment that combines BioArctic's BrainTransporter technology with an undisclosed Lilly drug candidate, BioArctic said Monday.

Under the agreement, BioArctic said it will receive a $30 million upfront payment and could earn up to $770 million in development, regulatory and commercial milestone payments.

BioArctic said it will also be eligible for tiered mid-single-digit royalties on future global sales if the product reaches the market.

BioArctic will generate the new drug candidate, while Lilly will assume responsibility for global development and commercialization, it added.