Eli Lilly to Buy Immunology Biotech Merida Biosciences in $2.9B Deal

Eli Lilly LLY announced that it has entered into a definitive agreement to acquire clinical-stage biotech Merida Biosciences in an all-cash transaction for up to $2.875 billion.

Though the deal includes an upfront payment as well as additional payments contingent on achieving specified development and regulatory milestones, neither company provided a breakdown of the consideration.

Upon completion of this acquisition, Lilly will add Merida’s antibody-engineering platform as well as a pipeline of biologics designed to target a range of immune-mediated conditions. This includes the lead drug, MER511, which is in phase I development for Graves' disease and thyroid eye disease (TED). Initial data have shown that the drug achieved robust reductions in pathogenic thyroid-stimulating antibodies, offering early evidence of its potential to address the underlying drivers of these diseases.

The deal will also add a couple of preclinical candidates to Lilly’s pipeline. This includes MER769, which is focused on food allergy, asthma, chronic spontaneous urticaria and other antibody-driven allergic diseases. Another candidate is MER683, which the company is developing to target kidney diseases, such as primary membranous nephropathy (PMN) and other immune-mediated conditions.

The transaction is expected to close in the fourth quarter of 2026.

LLY Stock Performance

Year to date, shares of Lilly have risen about 8% compared with the industry’s 14% growth.

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Merida Deal Extends Lilly's 2026 M&A Push

Unlike some of its peers, such as Bristol Myers BMY and Sanofi SNY, which have been facing investor pressure to pursue acquisitions to offset looming patent expirations, Lilly is entering this acquisition cycle from a position of financial strength. Strong demand for its blockbuster GLP-1 medicines Mounjaro and Zepbound has significantly boosted revenues and cash generation, giving the company greater flexibility to invest in external growth opportunities.

While obesity and diabetes remain Lilly's key growth drivers, the company has been steadily diversifying its pipeline into other therapeutic areas. Its recent acquisitions and deals across inflammation, oncology, neuroscience, cell therapy and infectious diseases highlight this strategy.

The latest example was Lilly's agreement last month to acquire AtaiBeckley for up to $3.8 billion, expanding its pipeline into novel treatments for mental health disorders. The proposed acquisition of Merida Biosciences fits into the same broader strategy, giving Lilly exposure to promising immunology assets and further reducing its reliance on the cardiometabolic franchise for future growth.

Lilly has been particularly active on the M&A front in 2026, with deals involving Ventyx Biosciences, Orna Therapeutics, Centessa Pharmaceuticals, Kelonia Therapeutics and Ajax Therapeutics, among others. The Merida transaction would likely mark Lilly’s 10th deal of the year, underscoring the company’s aggressive push to build a broader and more diversified pipeline of potential future growth drivers.

Eli Lilly and Company Price

 

Eli Lilly and Company price | Eli Lilly and Company Quote

LLY Zacks Rank

Eli Lilly currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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