Christy Santhosh and Sriparna Roy
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By Christy Santhosh and Sriparna Roy
(Reuters) -Eli Lilly will acquire gene-editing startup Verve Therapeutics for up to $1.3 billion, the companies said on Tuesday, accelerating a push into experimental cardiovascular therapies. The companies were partnering to develop one-time, gene-editing therapies to reduce high cholesterol in people with heart disease, as part of Lilly's efforts to look beyond its blockbuster weight-loss and diabetes drugs for growth. The U.S. drugmaker, which has struck multiple partnership deals with gene-editing companies in the last two years, has offered $10.5 per Verve share, a premium of 67.5% to the stock's last close.
Shares of Boston, Massachusetts-based Verve jumped 75% to $11.02 in early trading.
The Financial Times was the first to report that the companies were in talks.
The deal includes an upfront payment of almost $1 billion and a further $300 million based on Verve achieving certain clinical milestones.
"We are skeptical about the true market need of additional genetic medicines in these indications," BMO Capital Markets analyst Evan Seigerman said ahead of the deal, pointing to data from other cholesterol-lowering treatments.
However, analysts said the acquisition was a win for Verve and other players in the gene-editing space, which is currently losing favor among investors.
Kevin Gade, chief operating officer at Bahl & Gaynor, said the deal keeps Lilly within a known therapeutic area of cardiometabolic diseases, which includes its diabetes and weight-loss treatments.
The treatments, Mounjaro and Zepbound, are expected to bring combined sales of more than $30 billion this year, according to LSEG data.
Verve's therapies, which are in early-stage trials, use a form of gene editing known as base editing that causes one-time changes to patients' DNA.
The company's lead therapy, VERVE-102, targets a gene called PCSK9 that is linked to cholesterol levels and cardiovascular health and is expected to be launched in the next decade.
(Reporting by Ananya Palyekar, Christy Santhosh, Puyaan Singh and Sriparna Roy in Bengaluru; Editing by Alan Barona and Pooja Desai)
