Lilly closes acquisition of gene therapy developer Prevail Therapeutics

Eli Lilly and Co. closed its acquisition of Prevail Therapeutics Inc., a developer of gene therapies.

According to S&P Global Market Intelligence data, the total consideration for the deal was about $1.06 billion, based on a price of $26.50 per share.

The acquisition will extend Indianapolis-based Lilly's research efforts through the inclusion of a gene therapy program that uses New York-based Prevail's portfolio of therapies for neurodegenerative diseases such as Alzheimer's disease and Parkinson's disease, according to the drugmaker's Jan. 22 news release.

The transaction's impact will be reflected in Lilly's GAAP financial figures for 2021, but it will not change the company's 2021 financial guidance for research and development expense or non-GAAP earnings per share, the release said.

Lilly said the deal comprised a tender offer for all of the outstanding common shares of Prevail at $22.50 apiece.

The tender offer expired Jan. 21, and Computershare Trust Co. NA, the depositary and paying agent for the offer, has advised Lilly that 27,374,689 shares of Prevail were validly tendered and not properly withdrawn in the offer, representing about 79.8% of Prevail's common stock outstanding.

In addition, the deal included a non-tradable contingent value right, or CVR, to receive a contingent payment of up to $4 per share, if a Prevail product receives its first regulatory approval before Dec. 31, 2024, in the U.S., Japan, U.K., Germany, France, Italy or Spain.

If a regulatory approval occurs after Dec. 31, 2024, the value of the CVR will be reduced by about 8.3 cents per month until Dec. 1, 2028, at which point the CVR will expire.