Eli Lilly is acquiring Centessa Pharmaceuticals in a $6.3 billion deal that gives the company a contender in an emerging class of narcolepsy medicines that also have potential applications in a wider range of sleep disorders.
Beyond the upfront financial consideration, Lilly could pay out about $1.5 billion more if Centessa’s drugs achieve specified milestones, according to deal terms announced Tuesday.
Lilly’s main presence in neuroscience drugs is Emgality for migraine and Kisunla for Alzheimer’s disease. These medicines are small products relative to the rest of the company’s drug portfolio. Lilly’s nearly $1.4 billion in 2025 neuroscience drug revenue was the smallest of the therapeutic areas for which the company breaks out financial results. Cardiometabolic health dominates, followed by oncology and immunology. Centessa brings to Lilly a drug that could compete in narcolepsy, a therapeutic area that offers blockbuster sales potential.
Centessa’s lead drug, cleminorexton (formerly ORX750), is a once-daily pill intended to stand in for orexin, a neuropeptide that regulates the sleep/wake cycle. In narcolepsy, lack of native orexin leads to excessive sleepiness during the day and difficulty sleeping at night. The Centessa small molecule binds to the orexin 2 receptor as a way to restore the cycle. Lilly and Centessa claim this drug could be best in its class.
Takeda Pharmaceutical leads the orexin agonist class with oveporexton, a twice-daily pill currently under FDA review for the most common type of narcolepsy. Alkermes is next with alixorexton, a once-daily pill slated to enter Phase 3 testing. This pivotal program will span the two main types of narcolepsy as well as idiopathic hypersomnia, another sleep disorder. In an interview earlier this year, Alkermes Chief Operating Officer Blair Jackson said his company is also developing other orexin agonists for fatigue associated with Parkinson’s disease, multiple sclerosis, and attention deficit hyperactivity disorder. Meanwhile, Eisai recently began a narcolepsy Phase 2 test of its orexin agonist.
Centessa plans to test its drug in the two main types of narcolepsy as well as idiopathic hypersomnia. Beyond the less frequent dosing that is an advantage over Takeda’s drug, Centessa could differentiate by showing better tolerability. Frequent urination and visual disturbances have been reported in tests of orexin agonists.
In Centessa’s report of Phase 2a results last fall, the company said cleminorexton was safe and well tolerated. The most common adverse events were frequent urination, insomnia, dizziness, and headache. Centessa said these problems were transient and classified as mild to moderate in severity. In its most recent quarterly report, the company said it believes the data indicate the potential for a wide therapeutic window for the drug, the dose range that balances safety and efficacy. Centessa was expected to report updated mid-stage results this month. But with the Lilly buyout, analysts don’t think any new data disclosures are coming soon.
“Centessa management has been claiming that it has the best data,” Leerink Partners analyst Marc Goodman said in a research note. “We have no idea if that is true, but it’s likely that Lilly has seen much of this data, so the data must be pretty good.”
Goodman, who follows Alkermes, said the Centessa acquisition lends validation to orexin agonists and will expand the market for such drugs. On the other hand, Alkermes now faces a much larger and better-financed competitor. Leerink also expects Lilly to accelerate development of Centessa’s orexin agonists, taking leadership in non-narcolepsy indications.
Centessa was founded by life sciences investment firm Medixci, which structured the company to operate under a hub and spoke model in which drug assets spanning a range of indications were developed under subsidiaries. In time, Centessa came to focus on orexin agonists. Cleminorexton is its most advanced asset. Another orexin agonist called ORX142 is in early clinical development for neurological and neurodegenerative disorders. ORX489 is in preclinical development for neuropsychiatric disorders.
The deal terms call for Lilly to pay $38 in cash for each Centessa share, a more than 37% premium to the biotech’s closing price on Monday. When Centessa went public in 2021, it priced its shares at $20 apiece. The agreement could pay Centessa stockholders up to $9 more per share, depending on the progress of Centessa’s drugs. This contingent value right breaks down to $2 per share upon FDA approval of cleminorexton or ORX142 for narcolepsy type 2. This approval must happen within five years of the deal’s close. Another $5 per share would be paid out if either drug is approved for idiopathic hypersomnia, also within five years. Stockholders could get $2 more per share upon the first FDA approval of either drug for any indication before Jan. 1, 2030.
The boards of directors of both companies have approved the acquisition, which still needs approvals from Centessa shareholders and regulators. Lilly and Centessa expect to complete the transaction in the third quarter of this year.
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