Lilly seals up to $7.8 billion deal for Centessa in sleep disorder bet

Eli Lilly ​said ​on ​Tuesday it would buy Centessa ⁠Pharmaceuticals ‌in ⁠a deal valued at up to $7.8 billion as the U.S. ​drugmaker looks ​to diversify beyond ​its metabolic portfolio and expand into treatments for sleep disorders.

UK-based Centessa is developing treatments for ⁠excessive daytime ‌sleepiness and other neurological ⁠conditions. Its lead therapy is currently in mid-stage studies for narcolepsy or excessive daytime sleepiness.

Lilly has offered $38 per share ‌in cash, a premium of 37.8% to Centessa’s U.S.-listed stock’s last close. ​Centessa’s U.S.-listed shares jumped 46% in premarket trading.

Lilly has also offered one non-transferable contingent value right (CVR) of about $9 per share, ⁠or worth about $1.5 billion.

Centessa’s pipeline includes additional ‌clinical and preclinical-stage treatments with potential ‌to treat a broader range of neurological and neuropsychiatric conditions, the companies said.

The deal is expected ⁠to close in the third quarter.

Eli Lilly, which ⁠touched a trillion-dollar valuation ⁠last year on the success of its blockbuster weight-loss treatments, has been making sizable ​investments to bolster ‌other parts of its pipeline.

This year, the company has spent $2.4 billion to acquire Orna Therapeutics to expand its next-generation cell therapy capabilities, and more than $1 ​billion to buy autoimmune ‌drug developer Ventyx Biosciences.