Eli Lilly Snaps up Sleep-disorder Biotech in Multibillion-dollar Push beyond Weight-loss Drugs

The New York Times, Market Watch, Eli Lilly, the Wall Street, Axios, CNBC, and Bloomberg contributed to this report.

Eli Lilly is going shopping again – and this time it’s betting on sleep.

The drugmaker said Tuesday it plans to acquire Centessa Pharmaceuticals in a deal worth about $6.3 billion upfront, with the total value climbing to as much as $7.8 billion if certain milestones are hit. It’s a bold move aimed at widening Lilly’s reach beyond its blockbuster diabetes and weight-loss treatments.

Centessa isn’t a household name, but its science has caught attention. The company is working on treatments for excessive daytime sleepiness and narcolepsy, with a lead drug already in mid-stage clinical trials. That therapy targets the brain’s sleep-wake system – an area researchers increasingly see as ripe for breakthroughs.

Lilly is paying $38 a share in cash, a hefty premium that sent Centessa’s stock soaring more than 40% in early trading. There’s also a bonus layer: shareholders could get up to $9 more per share through milestone-based payouts tied to regulatory approvals.

The timing isn’t random.

Lilly has been on a spending streak, using the cash and momentum from its hugely successful obesity drugs to bulk up other parts of its pipeline. Earlier this year, it dropped billions on other biotech deals, chasing everything from cell therapies to autoimmune treatments.

Now it’s turning to neuroscience.

Centessa’s portfolio goes beyond a single drug. It includes a range of experimental therapies targeting neurological and psychiatric conditions, all built around the same underlying biology. Lilly sees that as a platform, not just a one-off bet.

The deal is expected to close in the third quarter, assuming regulators and shareholders sign off.

For Lilly, the logic is straightforward. Its current dominance in metabolic drugs won’t last forever, and competition is intensifying. Expanding into sleep disorders – and potentially broader brain-related conditions – offers a new lane for growth.

For Centessa, it’s an exit with upside still attached.

And for patients? That depends on whether the science delivers.