UPDATE 1-Lilly enters psychedelic drug race with up to $3.8 billion AtaiBeckley deal
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July 16 (Reuters) - Eli Lilly LLY.N said on Thursday it would buy AtaiBeckley ATAI.O for up to $3.8 billion, entering the race to develop psychedelic treatments for depression and other mental health disorders.
Lilly will pay $6.75 per AtaiBeckley share in cash, representing a premium of about 26% to the stock's closing price on Wednesday.
Shares of AtaiBeckley were up more than 30% in premarket trading.
The deal gives Lilly access to AtaiBeckley's lead candidate BPL-003, a psychedelic-based nasal spray in late-stage development for treatment-resistant depression, a severe form of the illness that does not improve after standard treatments.
The deal consists of around $2.8 billion upfront and $1 billion if certain milestones are met.