After entering the CAR T space in February, Eli Lilly is “jumping into in vivo CAR-T with both feet” with the acquisition of Kelonia Therapeutics and its gene delivery technology.
After getting a taste of CAR T in February, Eli Lilly is doubling down with the up to $7 billion acquisition of gene delivery biotech Kelonia Therapeutics.
Lilly snags a Phase 1 lentiviral in vivo CAR-T therapy called KLN-1010 in the deal, however the real prize is Kelonia’s in vivo gene delivery and integration technology, called iGPS. The platform uses lentiviral-based particles to deliver T-cells, at which point the patient’s body takes over and generates its own CAR T therapies. The goal is to eliminate the need for complex manufacturing processes and pre-treatment chemotherapy.
Kelonia will add to Lilly’s current capabilities in the space and allow the application of the delivery technology to other conditions, Jacob Van Naarden, president of Lilly Oncology and head of corporate business development, said in a statement.
The Kelonia deal had been rumored over the weekend after a report in Reuters. Commenting on the potential transaction in a Sunday note, BMO Capital Markets suggested that Lilly was “jumping into in vivo CAR-T with both feet.”
The deal “would add a complementary in vivo approach that could broaden Lilly’s push to build oncology beyond small molecules and antibodies. Aiding in efforts to drive durable growth beyond metabolic,” the analysts wrote.
That said, in vivo CAR T is not a slam dunk and Lilly will face some tough competitors in Gilead Sciences, AbbVie and Bristol Myers Squibb. “In vivo CAR-T remains an unproven and risky area of development,” BMO said.
But Lilly is likely up for the challenge. “We believe Lilly’s strong balance sheet and cash flow can support this higher-risk program,” the analysts said.
KLN-1010 uses Kelonia’s iGPS technology to treat multiple myeloma, with early data from an early-stage trial presented last year confirming the viability of the idea and demonstrating tolerability. The presentation at American Society of Hematology “demonstrated some impressive early responses,” according to BMO.
The deal expands Lilly’s presence in genetic medicines and marks the pharma’s second in the CAR T space, after the $2.4 billion acquisition of Orna Therapeutics in February. BMO noted that Kelonia’s anti-BCMA CAR T cell approach would be complimentary to Orna, which offered Lilly an in vivo CD19 CAR-T program for B cell malignancies and autoimmune diseases.
“A deal to acquire Kelonia would reflect a clear strategic fit to Lilly’s core oncology and immunology franchises,” BMO wrote on Sunday.
Lilly will pay $3.25 billion upfront with other payments due to Kelonia shareholders upon achievement of certain milestones. The deal is expected to close in the second half of 2026.
Lilly has been on an M&A hot streak this so far this year, securing the title of most acquisitive pharma in the first quarter with three buyouts. The largest deal—which has now been eclipsed by Kelonia—was Centessa Pharmaceuticals for $6.3 billion.
