Eli Lilly to acquire Kelonia Therapeutics for $7bn

July 2026 | DEALFRONT | MERGERS & ACQUISITIONS

Financier Worldwide Magazine

July 2026 Issue

US drug manufacturer Eli Lilly has agreed to acquire privately held biotech firm Kelonia Therapeutics in a deal valued at up to $7bn.

Under the terms of the agreement, Eli Lilly will acquire Kelonia, with shareholders set to receive total consideration of up to $7bn in cash. This includes an upfront payment of $3.25bn and additional payments tied to clinical, regulatory and commercial milestones.

The deal remains subject to customary closing conditions, including regulatory approvals, and is expected to complete in the second half of 2026. Eli Lilly will determine the accounting treatment of the transaction in accordance with generally accepted accounting principles upon closing, after which it will be reflected in the company’s financial results.

The acquisition is expected to strengthen Eli Lilly’s oncology portfolio, which includes blood cancer therapy Jaypirca, breast cancer treatment Verzenio and pipeline candidates. It also reinforces the company’s position in the competitive cancer therapeutics market. According to IQVIA, global spending on cancer medicines is projected to reach $409bn by 2028, rising from approximately $223bn in 2023.

Reflecting strong industry growth, Eli Lilly has recently been active in dealmaking. In April, the company agreed to acquire CrossBridge Bio, a biotech firm specialising in antibody-drug conjugate technology, for up to $300m. Later the same month, it announced a $2.3bn agreement to acquire Ajax Therapeutics, focused on developing next-generation JAK inhibitors for myeloproliferative neoplasms.

Kelonia is developing a pipeline of genetic medicines centred on CAR-T therapies, which reprogramme a patient’s immune cells to identify and eliminate cancer cells. Its lead candidate, KLN-1010, is being evaluated in an early-stage clinical study for multiple myeloma, a cancer affecting plasma cells in the bone marrow.

According to Eli Lilly, early data presented at a medical conference last year provided “initial clinical validation” and “promising tolerability”. If confirmed in further trials, KLN-1010 could represent a “transformative advance” by “eliminating the complexities” associated with existing cell therapies, the company said.

Eli Lilly’s expansion into oncology marks a shift from its traditionally dominant position in diabetes and obesity treatments. In recent years, the company has pursued acquisitions and partnerships to build a broader pipeline spanning gene therapies and gene-editing approaches targeting conditions such as high cholesterol, hearing loss and cancer.

“Autologous CAR-T therapies have meaningfully improved outcomes for patients with various cancers, but significant manufacturing, safety, and access barriers mean that only a fraction of eligible patients actually receive them,” said Jacob Van Naarden, executive vice president and president of Lilly Oncology and head of corporate business development. “Kelonia’s in vivo platform has the potential to change that by delivering rapid, durable responses in a far simpler, off-the-shelf format.

“The early clinical data for KLN-1010 are highly encouraging, both as a potential step forward for patients with multiple myeloma and as proof of concept for Kelonia’s platform,” he added.

“Kelonia’s leadership in advancing the immense promise of in vivo cell therapy is unmatched, extending its reach and impact beyond the traditional boundaries of personalized medicine,” said Kevin Friedman, chief executive of Kelonia. “We have demonstrated the ability to achieve deep multiple myeloma remissions with significantly reduced complexity and cost relative to ex vivo CAR T-cell approaches.”

Mr Friedman added that, combined with Lilly’s capabilities, the company’s in vivo iGPS platform is expected to expand the reach of cell therapy beyond the current CAR-T landscape in haematologic malignancies and potentially transform treatment across a much broader range of cancers and serious diseases.

The acquisition underscores Eli Lilly’s strategic shift toward innovative oncology and gene therapies, positioning the company to expand its pipeline, compete effectively and deliver potentially transformative treatments for patients.

Richard Summerfield