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Lilly to buy Armo Biosciences for $1.6 billion to bolster its cancer pipeline

Drugmaker Eli Lilly said on Thursday it would buy Armo BioSciences for about $1.6 billion to bolster its portfolio of cancer drugs, merely four months after the smaller drug developer went public.

Lilly’s offer of $50 per share in cash represents a premium of 68 percent to Armo’s Wednesday close. Armo’s shares were trading at $50.10 before the opening bell.

The deal gives Lilly access to Armo’s lead candidate, pegilodecakin, which is being studied in a late-stage clinical trial in pancreatic cancer, as well as earlier stage trials in other forms of cancer.

Lilly already has a large portfolio of cancer treatments. Its lung cancer drug, Alimta, helped it comfortably beat analysts’ profit expectations for the first quarter.

The transaction is expected to close by the end of the second quarter of 2018.

source : www.cnbc.com