With the acquisition of Merida Biosciences, Eli Lilly is gaining a precision degradation platform for therapies that selectively target and destroy pathologic antibodies for allergic and autoimmune diseases.
Eli Lilly is once again bringing out the checkbook, this time to pick up Massachusetts-based Merida Biosciences and its pipeline of precision therapies for autoimmune and allergic diseases.
The Indiana giant will be on the hook for up to $2.875 billion in cash, covering an upfront payment and contingent milestones. The pharma didn’t provide a specific financial breakdown in its news release on Monday morning. Pending clearances, the companies expect to close the transaction in the fourth quarter.
“We view the deal as a strategic use of capital, aligning with Lilly’s earlier [business development] efforts and diversifying their I&I pipeline,” BMO Capital Markets wrote in a Monday note.
Merida will bring to Lilly a Phase 1 asset called MER511, an investigational precision therapy being studied for thyroid eye disease (TED) and Graves’ disease. MER511 works by targeting and depleting not just autoreactive antibodies but also their source B cells, according to the biotech’s website.
Lilly will also get MER769, a preclinical antibody that disrupts the underlying biology of allergies. The asset has potential for food allergy, asthma and chronic spontaneous urticaria, according to the Monday announcement.
Aside from investigational therapies, the Merida acquisition will also give Lilly ownership over the biotech’s precision degradation platform, which can generate targeted biologic therapies that selectively target and destroy disease-causing autoantibodies. Such an approach, the pharma said, addresses the underlying biology of many autoimmune and allergic conditions without needing to suppress the immune system.
“We see potential to apply this precision approach across a broad range of antibody-driven diseases,” Francisco Ramírez-Valle, senior vice president of Lilly’s immunology research and early clinical development, said in a prepared statement.
Merida is the latest pickup in what has been a busy year of dealmaking for Lilly so far. Last month, the pharma put up to $3.8 billion on the line—including a $2.8 billion upfront payment—to absorb AtaiBeckley, marking Lilly’s entry into the burgeoning psychedelics space. A few weeks earlier, the pharma earmarked up to $1.9 billion in a licensing agreement with China’s Abbisko Therapeutics.
Other notable Lilly buys in recent months include the $6.3 billion takeover of sleep specialist Centessa Pharmaceuticals in March and the $7 billion purchase of Kelonia Therapeutics in April. In roughly the first six months of the year, the pharma has set aside more than $25 billion in business development dollars, according to a June analysis from BioSpace.
