Lilly (LLY) to acquire Centessa Pharmaceuticals (CNTA) to advance treatments for sleep-wake disorders; Will pay USD 38/shr in cash plus potential USD 9.00/shr in future milestones; total potential consideration up to USD 47/shr
The upfront cash consideration represents an aggregate equity value of approximately USD 6.3bln and the CVR represents an additional potential aggregate equity value of approximately USD 1.5bln.
Terms
- Under the terms of the transaction agreement, Lilly will acquire all of the issued and to be issued share capital of Centessa (including the American Depositary Shares (ADSs) representing ordinary shares) for $38.00 in cash per share plus one non-transferrable contingent value right (CVR) that entitles the holder to receive up to an aggregate of $9.00 subject to the achievement of three milestones described below, for total potential aggregate per share consideration of up to $47.00.
- CVR holders would become entitled to receive contingent payments as follows: (i) $2.00 per CVR in cash, upon U.S. FDA approval of cleminorexton (formerly ORX750) or ORX142 for the treatment of narcolepsy type 2 prior to the fifth anniversary of transaction closing; (ii) $5.00 per CVR in cash, upon U.S. FDA approval of cleminorexton (formerly ORX750) or ORX142 for the treatment of idiopathic hypersomnia prior to the fifth anniversary of transaction closing; and (iii) $2.00 per CVR in cash, upon the first U.S. FDA approval of cleminorexton (formerly ORX750) or ORX142 for the treatment of any indication prior to January 1, 2030.
- There can be no assurance that any payments will be made with respect to the CVR.
Eli Lilly's acquisition of Centessa Pharmaceuticals at $38 per share, with potential milestone payments increasing the total to $47, signifies a strategic move to enhance its portfolio in sleep-wake disorder treatments. This deal, valued at approximately $6.3 billion plus an additional $1.5 billion in contingent value rights, reflects Lilly's commitment to expanding its therapeutic capabilities, though the uncertain nature of the CVR payments could introduce some risk. Overall, this acquisition may bolster investor confidence and could drive further interest in the pharmaceutical sector.