Eli Lilly agreed Thursday to acquire psychedelic drugmaker AtaiBeckley for $2.8 billion upfront, placing a sizable bet that a DMT-derived nasal spray can succeed where traditional antidepressants have failed for patients with treatment-resistant depression.
The cash offer of $6.75 per share represents a 26 percent premium to AtaiBeckley's Wednesday close of $5.36, and Lilly could pay up to $1 billion more if the experimental drug hits development and regulatory milestones. Shares of AtaiBeckley jumped more than 30 percent in morning trading after the announcement.
The deal centers on BPL-003, a nasal spray formulation of dimethyltryptamine that is administered in a clinic under roughly two hours of monitoring. The drug is already in Phase 3 trials, though initial results are not expected until 2029. AtaiBeckley is also advancing an MDMA-related candidate for mental health conditions.
Lilly's chief scientific officer Dan Skovronsky told CNBC that the mechanism differs from drugs like Prozac, which slowly alter brain chemistry. Psychedelics may instead prompt neurons to form new connections quickly, with effects that could persist for months and require dosing only a couple of times a year. The field is still debating whether the therapeutic effect is separable from the hallucinogenic experience, Skovronsky said.
The acquisition arrives as the Trump administration has signaled priority for psychedelic-based treatments for depression and post-traumatic stress disorder. For Lilly, it also echoes a historical pattern: Prozac transformed depression care and powered the company's last major sales surge before the current GLP-1 wave. Skovronsky compared today's skepticism around psychedelics to the stigma that once surrounded depression treatment itself.
The purchase continues an aggressive dealmaking streak. Before this announcement, Lilly had already committed more than $10 billion upfront and potentially $25 billion across eight acquisitions this year, deliberately targeting later-stage assets as it operates as the world's most valuable healthcare company. "If we see great ideas that we think we can use to help people that need them, of course we'll do deals," Skovronsky said.
Investors will watch whether the Phase 3 data due in 2029 validates the premium, and whether regulators ultimately approve a clinic-administered psychedelic for a broad depression population. The milestone structure limits downside if the program stalls, but the six-year wait for pivotal data means capital is locked up with no revenue visibility.