Inside the CVR of Lilly’s Sigilon deal

This year has brought a notable increase in biopharma M&A deals that include contingent value rights, with the 15 such deals so far more than all of last year’s total. One of the transactions, between Lilly and Sigilon, pushes the model toward an almost entirely back-loaded CVR.

Eli Lilly and Co (NYSE:LLY) is acquiring Sigilon Therapeutics Inc. (NASDAQ:SGTX), in a deal announced June 29, primarily for the biotech’s SIG-002 candidate for Type I diabetes. The deal was structured with upfront cash of $34.6 million, or $14.92 per share, plus a non-tradeable contingent value right (CVR) that brings an additional potential of $111.64 per share, about 7.5x the upfront payment, if all three of the CVR tranches are met. ...