Eli Lily (LLY) announced on Thursday that it would buy its diabetes treatment partner, Therapeutic Sigilon (SGTX), and the biotech stock soared into triple digits.
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On the stock exchange today, Sigilon shares climbed 438.2% to close at 9:15 p.m. Lilly shares rose 1.3% to end at 464.49.
The deal values Sigilon stock at $14.92 per share, or approximately $34.6 million in total. Shareholders will also receive a contingent value right worth up to an additional $111.64 per share in cash. The CVR is tied to clinical and regulatory milestones and brings the total value of the agreement to $309.6 million.
Lilly and Sigilon first forged an alliance in 2018 to test encapsulated cell therapies. They are currently working on a cell therapy for type 1 diabetes.
Ruth Gimeno, Lilly Group Vice President for Diabetes, Obesity and Cardiometabolic Research, noted the challenges patients with type 1 diabetes still face.
“By combining Sigilon’s talent and expertise in cell therapy with the knowledge and skills of Lilly’s research and development teams, we will increase opportunities to create innovative islet cell therapy solutions to improve care for people with the disease. diabetes,” she said in a written statement. .
The news lifted Sigilon biotech stock to its highest level since January 2022.
Sigilon is also working on treatments for lysosomal and liver diseases.
Follow Allison Gatlin on Twitter at @IBD_AGatlin.
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