Eli Lilly has struck a deal to acquire Merida Biosciences for up to $2.875 billion, establishing a beachhead in its efforts to treat disease through the selective degradation of pathogenic autoantibodies.
Merida exited stealth last year with $121 million and a vision for a new way of treating autoimmune and allergic diseases. While many existing therapies work by suppressing the immune system, Merida’s drug candidates target disease-driving antibodies that interact inappropriately with healthy cells. Eliminating the antibodies could treat disease without disrupting normal processes.
Lilly sees promise in Merida’s technology. The biotech’s approach aligns with the Big Pharma’s focus on changing the course of disease, not just its downstream effects, Francisco Ramírez-Valle, M.D., Ph.D., senior vice president at Lilly immunology research and early clinical development, said in a statement.
The $2.875 billion offer includes an upfront fee and milestone payments. In return for the outlay, Lilly will acquire a pipeline led by a potential Graves’ disease (GD) treatment. Merida began a phase 1 trial of its GD drug candidate, MER511, in December. Participants are receiving intravenous or subcutaneous doses of MER511.
In GD, autoantibodies bind thyroid-stimulating hormone receptors (TSHRs). The autoantibodies trigger thyroid hormone production, accelerating metabolic activity, and can lead to thyroid eye disease (TED). Targeting the autoantibodies could treat the underlying cause of GD while preserving healthy signaling. Initial phase 1 data show robust reductions in thyroid-stimulating antibodies, Lilly said.
Current GD treatments include medicines that stop the thyroid from making hormones or block their activity. Amgen’s Tepezza is among the treatment options for patients who develop TED.
Investigational GD treatments include FcRn blockers from argenx and Immunovant and a BTK inhibitor, rilzabrutinib, from Sanofi. Biohaven is developing an IgG degrader, BHV-1300, while Lycia Therapeutics has designed LCA-0321 to bind and eliminate TSHR autoantibodies.
Merida’s R&D ambitions extend beyond GD. The biotech is moving a treatment for IgE-mediated allergic disease, MER769, and a primary membranous nephropathy program toward the clinic. Lilly noted the potential for MER769 to treat food allergy, asthma and chronic spontaneous urticaria.
The deal feeds Lilly’s voracious appetite for assets. Propelled by sales of its GLP-1 drugs, the company has inked a series of buyouts and licensing pacts this year, penning multibillion-dollar deals with biotechs including AtaiBeckley, Centessa Pharmaceuticals and Kelonia Therapeutics.