Eli Lilly acquires Kelonia Therapeutics for $7 billion to diversify beyond weight-loss drugs into cancer gene therapy

Eli Lilly announced a $7 billion acquisition of privately held Kelonia Therapeutics to add KLN-1010, a CAR-T gene therapy (a treatment that reprograms a patient's own immune cells to fight cancer) currently in early-stage trials. The company is hedging its bet on weight-loss drugs by building a broader pipeline of cancer treatments.

Lilly spent 20.5% of its 2025 revenue on research and development with about a quarter of its workforce focused on R&D — a significant commitment to finding future blockbuster drugs beyond the crowded weight-loss market where multiple competitors (including Novo Nordisk and others) are already selling approved products.

For investors deciding whether to add Lilly stock to a portfolio, the company's valuation has become more attractive: its current price-to-earnings ratio of 40 is well below its five-year average of 56, even though fourth-quarter revenue grew 43% year-over-year and earnings per share jumped 51%. Healthcare spending itself is accelerating (up 7.2% from 2023 to 2024, outpacing the 2010s average of 4.2%), so the sector remains structurally strong as the population ages.