Eli Lilly and Company announced a definitive agreement to acquire Merida Biosciences for up to $2.875 billion in cash, inclusive of an upfront payment and contingent milestones. The Cambridge, Massachusetts-based biotechnology firm is developing a new class of precision therapeutics designed to selectively remove disease-causing antibodies while preserving normal immune function.
Merida’s lead program, MER511, is in Phase 1 development for Graves’ disease and thyroid eye disease. Early data indicated robust reductions in pathogenic thyroid-stimulating antibodies with a favorable initial safety profile. Lilly said the acquisition strengthens its immunology capabilities and positions the company to address immune-mediated conditions with high unmet need.
The transaction is subject to customary closing conditions and regulatory approvals and is expected to close in the fourth quarter of 2026. Lilly will determine the accounting treatment under GAAP upon closing. Merida launched last year with $121 million in Series A financing co-led by Bain Capital Life Sciences, BVF Partners and Third Rock Ventures.
The deal forms part of a broader 2026 acquisition campaign by Lilly, which has used cash generated by its market-leading weight-loss and diabetes franchise to expand into adjacent therapeutic areas. Recent transactions have included mental-health, vaccine, oncology and genetic-medicine assets. Analysts view the Merida purchase as a logical extension of Lilly’s efforts to build a more diversified late-stage and early-stage pipeline beyond incretin therapies.
Shares of Eli Lilly were expected to react to the announcement amid a mixed broader market backdrop driven by Middle East developments and elevated rate expectations. Investors will monitor integration progress and any additional pipeline updates as the company continues to deploy capital from its high-margin commercial products.