Lilly buys SGX for $64M

SGX Pharmaceuticals' stock surged on the news that Eli Lilly would purchase the company for $64 million in an all-cash deal. The two companies began their initial collaboration in 2003, when Lilly started using SGX's technology to determine the 3-dimensional structures of key drug targets. Lilly gains access to SGX's structure-guided drug discovery platform, its fragment-based, protein structure guided drug discovery technology, and a variety of pre-clinical oncology drug targets.

"After a successful collaboration over the past several years, we are excited to bring the scientific and technological expertise of SGX into Lilly's research organization, while at the same time expanding our presence in the San Diego area," commented Steven M. Paul, M.D., executive vice president, science and technology for Lilly. "We will leverage the combined resources of both companies to strengthen our structural biology capabilities and seek out innovative therapies for patients."

SGX's shares rose to $3, up significantly from its $1.37 close yesterday. However, the stock didn't come close to its previous high of $7.95. FiercePharma named SGX's stock one of the best of 2007 but shares slid in March due to unfavorable oncology data.

- see SGX's release
- read the WSJ article for more