With the AtaiBeckley acquisition, Eli Lilly is jumping into psychedelics, a drug class that Jefferies analysts say could herald the “biggest change” for the field of psychiatry.
Eli Lilly is acquiring AtaiBeckley in a deal that marks the pharma’s first foray into the emerging psychedelics field.
Under the terms of the agreement, Lilly will pay $6.75 a pop for AtaiBeckley’s common stock, corresponding to a $2.8 billion upfront commitment, according to a Thursday morning release. The pharma is also tacking on a contingent value right (CVR) of up to $2.50 per share, payable upon certain milestones. All told, the CVR could add another $1 billion to the total deal value.
Boards of directors for Lilly and AtaiBeckley have signed off on the acquisition and the companies expect to close the deal in the third quarter. AtaiBeckley’s stock climbed nearly 35% in premarket trading Thursday to $7.20.
As a drug class, psychedelics “is generating strikingly positive data,” Jefferies analysts told investors in a Thursday morning note. Key opinion leaders consulted by the firm “confirm psychedelics could represent the ‘biggest change’ to psychiatry and are possibly a ‘paradigm shift,’ with patient demand already seeming ‘insatiable.’”
AtaiBeckley’s lead asset, BPL-003, is a synthetic form of a psychedelic compound called 5-MeO-DMT being developed for treatment-resistant depression (TRD). Phase 2a data published in April showed that BPL-003, designed to be delivered via a nasal spray, elicited an antidepressant response in 66.7% of patients by the second day. These responses were durable through 85 days of follow-up. AtaiBeckley said in May that topline Phase 3 data could come in early 2029.
For Lilly, BPL-003 offers a “differentiated short-duration psychedelic that has shown rapid, meaningful, and durable efficacy” in TRD, Jefferies said.
It’s a common target for psychedelics, which hold promise to treat intractable mental illness. In January 2025, J&J’s esketamine-based Spravato became the first monotherapy approved by the FDA for TRD. And Compass Pathways, the frontrunner in the more traditional psychedelics space, is also pursuing the indication for its psilocybin-based therapy COMP360.
With a rolling submission for COMP360 already underway, Compass reported positive durability results for the therapy earlier this month. The biotech anticipates a potential launch as early as the first half of next year.
Compass shares were up more than 9% in premarket trading on Thursday.
In recent months, the psychedelic space has been on the receiving end of policy tailwinds. In April, President Donald Trump put out an executive order instructing the FDA to grant its Commissioner’s National Priority Vouchers—designed to expedite drug reviews for companies whose products align with certain national priorities—to certain psychedelic developers. The agency was quick to comply and handed out three such tickets, including one to COMP360.
On Monday, the FDA released its finalized guidance document for psychedelic drug development, outlining practices for modeling the therapies’ potential to be abused and for measuring their overall efficacy.
“FDA’s final guidance on psychedelics suggests the agency remains receptive to helping sponsors succeed,” Jefferies wrote in a Monday note.
