Lilly to buy Merida Biosciences for up to $2.88 billion

Eli Lilly said on Aug. 31, 2026 that it agreed to acquire Merida Biosciences, a privately held biotechnology company based in Cambridge, Massachusetts, for up to $2.88 billion in cash ^[1]. Lilly's own announcement put the total at up to $2.875 billion, inclusive of an upfront payment and contingent milestone payments ^[2][3].

Merida's lead drug candidate, MER511, is in Phase 1 development for Graves' disease and thyroid eye disease (TED) ^[2]. Phase 1 is the earliest stage of testing in people.

MER511 is a biologic designed to selectively degrade pathogenic autoantibodies, the disease-causing agents behind a range of immune-mediated conditions, rather than broadly suppressing the immune system the way many current therapies do ^[2]. Graves' disease and TED are driven by thyroid-stimulating immunoglobulins, autoantibodies that activate the thyroid-stimulating hormone receptor ^[2]. BioSpace reported that MER511 works by targeting and depleting not just autoreactive antibodies but also their source B cells, citing Merida's website ^[4].

Lilly said initial data showed MER511 substantially lowered the thyroid-stimulating antibodies linked to the diseases while showing a favorable initial safety profile ^[1]. The company described those reductions as robust ^[2]. The number of participants, the doses tested, and how long patients were followed have not been disclosed ^[2].

Graves' disease affects approximately 3 million people in the United States, and patients face elevated cardiovascular risk and mortality, according to Lilly ^[2]. Roughly 25 to 40 percent of people with Graves' disease go on to develop TED, which can cause pain, disfigurement, and in severe cases, vision loss ^[2]. Treatments for Graves' disease currently include antithyroid medications, radioactive iodine and surgery, while two FDA-approved medicines exist for thyroid eye disease: Amgen's Tepezza and Viridian Therapeutics' Lumvoa ^[1]. None of the approved treatments directly target the autoantibodies that cause these conditions ^[2].

Beyond MER511, Merida's pipeline includes MER769, a preclinical program focused on food allergy, asthma, chronic spontaneous urticaria and other allergic diseases, plus earlier-stage programs in kidney diseases such as membranous nephropathy and other immune-mediated conditions ^[2].

"We're building our pipeline around therapies that meaningfully change the course of disease, not just its downstream effects," said Francisco Ramírez-Valle, senior vice president of Lilly immunology research and early clinical development ^[1]. "Merida's lead program is designed to do exactly that" ^[1].

Lilly has been on an acquisition spree following windfall profits from its weight-loss drugs, and its deal spending in 2026 has outpaced prior years as it aims to expand beyond obesity and diabetes ^[1]. Leerink Partners analyst David Risinger called the purchase "further evidence of management's intent to diversify Lilly's pipeline beyond obesity" ^[1]. BMO Capital Markets wrote that it views the deal as a strategic use of capital that diversifies Lilly's immunology and inflammation pipeline ^[4].

Why it matters for patients

MER511 is in the earliest stage of human testing. It is not approved, is not available outside clinical trials, and there is no evidence yet that it changes outcomes for people with Graves' disease or thyroid eye disease ^[1][2]. Lilly has not said when later-stage trials might begin or report results ^[2].

For people already taking GLP-1 medicines such as Ozempic, Wegovy, Rybelsus, Mounjaro or Zepbound, this deal does not change what is available, covered or priced. The upfront amount and milestone terms were not disclosed, and no pricing information for any future product was given ^[1][2].

The transaction could still fall through. Lilly said the deal is subject to customary closing conditions, including regulatory approvals, and that there is no guarantee it will close, achieve the results described, or yield commercially successful products ^[2].

What happens next

Lilly expects the acquisition to close in the fourth quarter of 2026, subject to customary closing conditions and regulatory approvals ^[1][2]. Lilly said it will determine the accounting treatment under Generally Accepted Accounting Principles upon closing, after which the transaction will be reflected in its financial results and guidance ^[2]. No date has been announced for additional MER511 data or for the start of later-stage trials ^[2].