Eli Lilly will gain a pipeline of target cancer therapeutics.

Just one week after Bristol-Myers Squibb announced that it will purchase Celgene for $74 billion in the biggest pharma deal ever, Eli Lilly has made its own move, though on a comparatively smaller scale. The company plans to buy targeted cancer drug developer Loxo Oncology for $8 billion, which will be its largest acquisition in 143 years. 

Loxo specializes in cancer drugs that target rare genetic mutations and has achieved positive clinical results for its lead candidate, which is designed to treat a variety of cancers driven by the TRK fusion gene mutation. There are more than 17 distinct types of advanced cancer with this same genetic mutation, and patients had no treatment options until Vitrakvi (larotrectinib) was developed. The drug has been shown to provide dramatic, often long-term improvement in 80% of treated patients. It won approval from the U.S. Food and Drug Administration in November 2018 and is sold in partnership with Bayer. 

Eli Lilly hopes to continue that partnership. Loxo also has a second candidate –– LOXO-292 –– that targets a different rare genetic mutation. It has also shown promise in the clinic, and Lilly will have full ownership of this drug if the deal closes as expected.

Identifying advanced cancer patients with the particular rare genetic mutations that make them suitable for these treatments is a bit challenging, however. Just 1% of patients with solid tumor cancers have the TRK mutation. Next-generation sequencing, which looks at hundreds of mutations across all solid tumors, is required. This approach is becoming more accepted. In 2018, Medicare said it would cover these analyses.