$2.8B Upfront Acquisition for Novel Psychedelic Assets; D/G to Hold

Research evidence excerpt

$2.8B Upfront Acquisition for Novel Psychedelic Assets; D/G to Hold

ame Aptar 2026 ($) Q1A Q2 Q3 Q4 FY

intranasal delivery device as Spravato. EPS (0.08) (0.09) (0.10) (0.10) (0.37)

PREV

LLY will acquire ATAI for $6.75/sh upfront ($2.8B equity value) plus up to $2.50/sh in CVRs ($1B

+). (1) In our view, our prior $1-2B+ peak sales estimate was arguably conservative, given BPL-003's

potential superiority to Spravato, the latter of which is on track to reach up to $5B+ in peak sales. (2)

We think the deal implies $1B+ of peak sales to BPL-003 (unadjusted), with minimal value ascribed

to VLS-01/EMP-01. (3) Even though Big Pharma's interest in psychedelics is rising, we believe the

chances of a competing bidder may be 10-25%. (4) Although ATAI technically has sufficient cash

to produce Phase III BPL-003 data in early 2029 ($210M+ cash as of Q1-end), we think more cash

is ultimately needed, especially if both VLS-01 and EMP-01 advance in 2027-28.

The deal is expected to close in Q3:26 - our thoughts on the 3 CVRs: (1) $1.00/sh upon initiation

of a Phase III trial of VLS-01 within 4 years post close fourth anniversary of closing. Although ATAI

has generated only Phase I data with VLS-01, an industry peer has previously generated supporting

DMT data in depression. We assign a 40-50% PoS, (2) $0.50/sh upon FDA approval and DEA

rescheduling of BPL-003 prior to the fifth anniversary of closing. We assign a high 75%+ PoS given

strong Phase IIb data, (3) $1.00/sh upon FDA approval and DEA rescheduling of VLS-01 prior to

the seventh anniversary of closing. CVR is contingent upon VLS-01 success in Q4. We assume a

<20% PoS. See Exhibit 1 for an NPV calculator.

Andrew Tsai * | Equity Analyst

+1 (415) 229-1566 | atsai@jefferies.com

Matthew Barcus, Ph.D. * | Equity Associate