Eli Lilly (NYSE:LLY) shares swooned on word the drug giant will acquire gene-editing startup Verve Therapeutics (NASDAQ:VERV) for up to $1.3 billion, the companies said on Tuesday.
Lilly has struck multiple partnership deals with gene-editing companies in the last two years to expand its portfolio beyond its blockbuster weight-loss and diabetes drugs.
The drugmaker will buy Verve for $10.5 per share, which is a premium of 67.5% on the company’s last close.
The deal includes an upfront payment of almost $1 billion and a further $300 million based on the genetic-medicines firm achieving certain clinical milestones.
The companies are already partnering to develop gene-editing therapies to reduce high cholesterol in people with heart disease, which are expected to be used in combination with other drugs.
"VERVE-102 has the potential to be the first in vivo gene editing therapy for broad patient populations and could shift the treatment paradigm for cardiovascular disease from chronic care to one-and-done treatment," said Ruth Gimeno, Lilly group vice president, Diabetes and Metabolic Research and Development.
"Lilly is eager to welcome our Verve colleagues to Lilly and continue the development of these promising potential new medicines aimed at improving outcomes for patients with cardiovascular disease and addressing the significant unmet medical need in this space."
Shares of Lilly were down 1% before the bell. They opened Tuesday lower by $7.15 to $800.43, while VERV vaulted $4.71, or 75.2%, to $10.98.
