Eli Lilly to buy cancer treatment company Loxo Oncology for $8 billion

File image

INDIANAPOLIS, Ind. (AP) – Eli Lilly is spending about $8 billion in cash to buy Loxo Oncology, as the drugmaker bulks up on cancer treatments that target certain gene abnormalities.

Loxo Oncology could launch a drug next year and targets an abnormality that occurs in several tumor types, including some lung and thyroid cancers, Lilly said in a prepared statement announcing the deal Monday.

Lilly, known for insulins like Humalog, has emphasized oncology growth over the past several years, and one of its top-selling products is the cancer treatment Alimta.

Eli Lilly and Co. will pay $235 for each share of Stamford, Connecticut-based Loxo. That’s a 68 percent premium to the company’s Friday closing price of $139.87.

The deal is expected to close by the end of the first quarter.

Lilly’s announcement was the second big pharmaceutical acquisition announced in the new year. It follows a $74-billion acquisition of Celgene by Bristol-Myers Squibb announced last week.

Shares of Eli Lilly, based in Indianapolis, fell nearly 3 percent to $111.39 in Monday premarket trading.

Notice: you are using an outdated browser. Microsoft does not recommend using IE as your default browser. Some features on this website, like video and images, might not work properly. For the best experience, please upgrade your browser.