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LLY to Buy Neuroscience Biotech Centessa Pharmaceuticals in $7.8B Deal
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Key Takeaways
Eli Lilly will buy Centessa for $6.3B upfront, with total value up to $7.8B including CVR payouts.
LLY gains OX2R agonist pipeline, led by cleminorexton in mid-stage trials for narcolepsy and IH.
Centessa surged 44% after the deal, which supports Lilly's broader pipeline diversification strategy.
Eli Lilly (LLY - Free Report) announced that it has entered into a definitive agreement to acquire U.K.-based Centessa Pharmaceuticals (CNTA - Free Report) . Per the terms, the pharma giant will acquire all outstanding shares (including American Depositary Shares) of CNTA for $38 per share in cash, aggregating to about $6.3 billion.
In addition, Centessa’s shareholders will receive one non-tradable contingent value right (CVR) per share. This CVR entitles holders to an additional cash payment of up to $9 per share, contingent on achieving FDA approvals of either of its two pipeline drugs (cleminorexton and ORX142) across narcolepsy type II and idiopathic hypersomnia (IH) indications over the next few years. Including the CVR, the total potential deal value reaches approximately $7.8 billion.
Post this acquisition, Lilly will add Centessa’s pipeline of orexin receptor 2 (OX2R) agonists for treating people with sleep-wake disorders. This includes the lead drug, cleminorexton (formerly ORX750), which is being evaluated in a mid-stage study for two types of narcolepsy (type I and II) and IH. Last year, CNTA reported initial results from this study, which Lilly describes as demonstrating “a potential best-in-class profile” for the drug.
Another drug in Centessa’s pipeline is ORX142, which is being evaluated in an early-stage study for neurological and neurodegenerative disorders. A third candidate, ORX489, is currently in preclinical development and is being developed for neuropsychiatric disorders.
The transaction, which was approved by the board of directors of both companies, is expected to be closed in the third quarter.
CNTA & LLY Stock Performance
Following this news on Tuesday, shares of Centessa increased 44%, while Lilly rose about 4%.
Year to date, CNTA stock has risen 59%, while that of LLY has lost more than 14%. During the same time frame, the industry has gained 1%.
Image Source: Zacks Investment Research
How Does CNTA Buyout Benefit LLY?
Unlike some of its peers, such as Bristol Myers and Sanofi, which are under pressure from investors to pursue deals for new drugs, Lilly’s top line continues to reach new heights. The tremendous success of GLP-1 drugs, Mounjaro (for diabetes) and Zepbound (for obesity), has helped make it the first pharmaceutical company to reach a market capitalization of $1 trillion.
The rationale behind the deal is clear — Lilly intends to strategically diversify its pipeline across therapeutic areas. Recent approvals in immunology (Omvoh and Ebglyss), oncology (Jaypirca) and neuroscience (Kisunla) highlight Lilly’s intent to diversify beyond obesity and diabetes. A potential deal for Centessa fits this trend.
The transaction benefits CNTA, which lacks the commercial infrastructure and global scale required to bring advanced therapies to market, areas where LLY is already well established.
While broader macroeconomic concerns — including Trump-era tariffs and leadership shifts at the FDA — have weighed on deal-making last year, Big Pharma continues to pursue strategic assets in key growth areas.
Recently, Biogen (BIIB - Free Report) announced its intent to acquire Apellis Pharmaceuticals for an upfront cash payment of about $5.6 billion to strengthen its immunology and rare disease portfolio. Through this transaction, BIIB intends to add two FDA-approved therapies — Empaveli and Syfovre. While Empaveli is approved for paroxysmal nocturnal hemoglobinuria (PNH) and two rare kidney diseases, Syforve is indicated for geographic atrophy. Biogen expects to close this deal in the second quarter of 2026.
Gilead Sciences (GILD - Free Report) is another company that has been involved in an acquisition spree since the start of this year. Last month, GILD entered into a deal worth $2.2 billion to acquire Ouro Medicines to strengthen its push into innovative therapies for autoimmune diseases. In February, Gilead announced its intent to acquire the clinical-stage biotechnology company Arcellx for an implied equity value worth $7.8 billion to boost its oncology portfolio.
These transactions highlight Big Pharma's continued interest in small biotechs with promising and innovative assets.
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LLY to Buy Neuroscience Biotech Centessa Pharmaceuticals in $7.8B Deal
Key Takeaways
Eli Lilly (LLY - Free Report) announced that it has entered into a definitive agreement to acquire U.K.-based Centessa Pharmaceuticals (CNTA - Free Report) . Per the terms, the pharma giant will acquire all outstanding shares (including American Depositary Shares) of CNTA for $38 per share in cash, aggregating to about $6.3 billion.
In addition, Centessa’s shareholders will receive one non-tradable contingent value right (CVR) per share. This CVR entitles holders to an additional cash payment of up to $9 per share, contingent on achieving FDA approvals of either of its two pipeline drugs (cleminorexton and ORX142) across narcolepsy type II and idiopathic hypersomnia (IH) indications over the next few years. Including the CVR, the total potential deal value reaches approximately $7.8 billion.
Post this acquisition, Lilly will add Centessa’s pipeline of orexin receptor 2 (OX2R) agonists for treating people with sleep-wake disorders. This includes the lead drug, cleminorexton (formerly ORX750), which is being evaluated in a mid-stage study for two types of narcolepsy (type I and II) and IH. Last year, CNTA reported initial results from this study, which Lilly describes as demonstrating “a potential best-in-class profile” for the drug.
Another drug in Centessa’s pipeline is ORX142, which is being evaluated in an early-stage study for neurological and neurodegenerative disorders. A third candidate, ORX489, is currently in preclinical development and is being developed for neuropsychiatric disorders.
The transaction, which was approved by the board of directors of both companies, is expected to be closed in the third quarter.
CNTA & LLY Stock Performance
Following this news on Tuesday, shares of Centessa increased 44%, while Lilly rose about 4%.
Year to date, CNTA stock has risen 59%, while that of LLY has lost more than 14%. During the same time frame, the industry has gained 1%.
Image Source: Zacks Investment Research
How Does CNTA Buyout Benefit LLY?
Unlike some of its peers, such as Bristol Myers and Sanofi, which are under pressure from investors to pursue deals for new drugs, Lilly’s top line continues to reach new heights. The tremendous success of GLP-1 drugs, Mounjaro (for diabetes) and Zepbound (for obesity), has helped make it the first pharmaceutical company to reach a market capitalization of $1 trillion.
The rationale behind the deal is clear — Lilly intends to strategically diversify its pipeline across therapeutic areas. Recent approvals in immunology (Omvoh and Ebglyss), oncology (Jaypirca) and neuroscience (Kisunla) highlight Lilly’s intent to diversify beyond obesity and diabetes. A potential deal for Centessa fits this trend.
The transaction benefits CNTA, which lacks the commercial infrastructure and global scale required to bring advanced therapies to market, areas where LLY is already well established.
Once closed, this will be the third acquisition deal signed by Lilly so far this year. Earlier in January, it signed a $1.2 billion deal to buy Ventyx Biosciences to deepen its exposure to oral small-molecule therapies targeting inflammatory-mediated diseases. In February, LLY announced its intent to acquire Orna Therapeutics for up to $2.4 billion, which will add a broad portfolio of in vivo CAR-T pipeline.
Recent M&A Transactions in the Pharma Space
While broader macroeconomic concerns — including Trump-era tariffs and leadership shifts at the FDA — have weighed on deal-making last year, Big Pharma continues to pursue strategic assets in key growth areas.
Recently, Biogen (BIIB - Free Report) announced its intent to acquire Apellis Pharmaceuticals for an upfront cash payment of about $5.6 billion to strengthen its immunology and rare disease portfolio. Through this transaction, BIIB intends to add two FDA-approved therapies — Empaveli and Syfovre. While Empaveli is approved for paroxysmal nocturnal hemoglobinuria (PNH) and two rare kidney diseases, Syforve is indicated for geographic atrophy. Biogen expects to close this deal in the second quarter of 2026.
Gilead Sciences (GILD - Free Report) is another company that has been involved in an acquisition spree since the start of this year. Last month, GILD entered into a deal worth $2.2 billion to acquire Ouro Medicines to strengthen its push into innovative therapies for autoimmune diseases. In February, Gilead announced its intent to acquire the clinical-stage biotechnology company Arcellx for an implied equity value worth $7.8 billion to boost its oncology portfolio.
These transactions highlight Big Pharma's continued interest in small biotechs with promising and innovative assets.
Eli Lilly and Company Price
Eli Lilly and Company price | Eli Lilly and Company Quote
Centessa Pharmaceuticals PLC Sponsored ADR Price
Centessa Pharmaceuticals PLC Sponsored ADR price | Centessa Pharmaceuticals PLC Sponsored ADR Quote
LLY & CNTA Zacks Rank
Both Eli Lilly and Centessa Pharmaceuticals currently carry a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.