Eli Lilly to Acquire Loxo Oncology for $8 Billion

Eli Lilly has announced that it will be acquiring Loxo Oncology for around $8 billion in cash, or an offer of $235 a share.

The offer is roughly 68% higher than Loxo’s closing price this past Friday. Shares of the company were soaring nearly 70% while shares of Lilly dropped 1.5%.

“We’d like to grow our presence in oncology. We have a good set of medicines there but we’d like to expand that because there’s so much exciting science for patients emerging in oncology to invest in,” said Lilly CEO David Ricks to CNBC’s Jim Cramer on “Squawk on the Street. ”

The company also said that it would update its financial outlook to include the acquisition when it announces its fourth quarter financial results next month.

It was in 2018 that Loxo’s Vitrakvi was approved by the FDA. Vitrakvi is the company’s first commercial medicine sold in partnership with Bayer, and has been shown to be effective against a variety of cancers that are driven by a single rare genetic mutation.

Lilly Oncology President Anne White told analysts, “We believe that Lilly will bring a great deal of strength to this partnership in addition to what Loxo has already done.”

Disclaimer: We have no position in Eli Lilly And Co (NYSE: LLY) nor Loxo Oncology Inc. (NASDAQ: LOXO) have not been compensated for this article.