Eli Lilly to acquire Loxo Oncology for $8 billion

Eli Lilly and Co. has agreed to acquire Loxo Oncology Inc. in an $8 billion deal.

Loxo Oncology has a pipeline of targeted anticancer agents — one of which is FDA approved — that focus on single gene abnormalities detected by genomic testing.

These agents include:

LOXO-292, a first-in-class oral RET inhibitor that targets cancers with alterations to the rearranged during transfection (RET) kinase. RET fusions and mutations occur in many tumor types, including certain lung and thyroid cancers. The agent has received breakthrough therapy designation for three indications;
LOXO-305, an oral inhibitor of Bruton tyrosine kinase— a molecular target found in many B-cell leukemias and lymphomas — that is under phase 1/phase 2 study;
larotrectinib (Vitrakvi), a first-in-class oral TRK inhibitor that was developed in collaboration with Bayer and is the first treatment targeting a specific genetic abnormality to receive a tumor-agnostic indication at the time of initial FDA approval; and
LOXO-195, a follow-on TRK inhibitor for acquired resistance to TRK inhibition.

“Using tailored medicines to target key tumor dependencies offers an increasingly robust approach to cancer treatment,” Daniel Skovronsky, MD, PhD, Eli Lilly's chief scientific officer and president of Lilly Research Laboratories, said in a press release. “Loxo Oncology's portfolio of RET, BTK and TRK inhibitors targeted specifically to patients with mutations or fusions in these genes, in combination with advanced diagnostics that allow us to know exactly which patients may benefit, creates new opportunities to improve the lives of people with advanced cancer.”

According to the agreement, Eli Lilly will acquire all outstanding shares of Loxo Oncology for $235 per share in cash, or approximately $8 billion. The tender offer — expected after the first quarter of 2019 — represents a premium of 68% to Loxo Oncology's closing stock price on Jan. 4, the last trading day before the announcement.

“We are gratified that Lilly has recognized our contributions to the field of precision medicine and are excited to see our pipeline benefit from the resources and global reach of the Lilly organization,” Josh Bilenker, MD, CEO of Loxo Oncology, said in the release. “Tumor genomic profiling is becoming standard of care, and it will be critical to continue innovating against new targets, while anticipating mechanisms of resistance to available therapies, so that patients with advanced cancer have the chance to live longer and better lives.”