Eli Lilly concludes acquisition of Akouos

Akouos brings more top-tier talent and an important pipeline to Lilly's Institute for Genetic Medicine that will further accelerate our work to advance genetic medicines for people living with difficult-to-treat diseases," said Andrew C. Adams, Ph.D., senior vice president of genetic medicine at Lilly and co-director of the Institute for Genetic Medicine. "We look forward to supporting and enabling the Akouos team to continue their ground-breaking work developing potential genetic medicines for inner ear conditions and to help fulfill the mission of making healthy hearing available to all."

The tender offer to purchase all of the issued and outstanding shares ("Shares") of Akouos's common stock in exchange for (a) $12.50 per Share, net to the stockholder in cash, without interest (the "Cash Consideration") and less any applicable tax withholding, plus (b) one non-tradable contingent value right ("CVR" and, together with the Cash Consideration, the "Offer Price") per Share, which represents the contractual right to receive contingent payments of up to $3.00 per CVR, net to the stockholder in cash, without interest and less any applicable tax withholding, upon the achievement of certain specified milestones (the "Offer"), expired as scheduled at one minute past 11:59 p.m., Eastern time, on Nov. 29, 2022 and was not extended (such date and time, the "Expiration Time").

Lilly previously announced that, as of the Expiration Time, 29,992,668 Shares were validly tendered and not validly withdrawn in the Offer, representing 81.1% of the issued and outstanding Shares as of the Expiration Time. In accordance with the terms of the Offer,Lilly and its wholly owned subsidiary, Kearny Acquisition Corporation ("Purchaser"), accepted for payment shares that were validly tendered and not validly withdrawn in the Offer.

Following consummation of the Offer, on Dec. 1, 2022,Lilly completed its acquisition of Akouos through the merger of Purchaser with and into >Akouos, and without a meeting of the stockholders of Akouos in accordance with Section 251(h) of the General Corporation Law of the State of Delaware (the "DGCL"), with Akouos surviving such merger as a wholly owned subsidiary of Lilly. In connection with the merger, each Share issued and outstanding immediately prior to the effective time of the merger (other than (i) Shares held in Akouos's treasury or owned by Akouos, or owned by Lilly, Purchaser or any direct or indirect wholly-owned subsidiary of Lilly or Purchaser or (ii) Shares held by any stockholder of Akouos who was entitled to demand and properly demanded appraisal for such Shares in accordance with Section 262 of the DGCL), including each Share that was subject to vesting or forfeiture restrictions granted pursuant to an Akouos equity incentive plan, program or arrangement, was cancelled and converted into the right to receive the Offer Price, without interest, less any applicable tax withholding. Akouos's common stock will be delisted from The Nasdaq Global Select Market and deregistered under the Securities Exchange Act of 1934, as amended.

Under the terms of the contingent value rights agreement, CVR holders would become entitled to receive contingent payments as follows: (i) $1.00 in cash, upon the fifth (5th) participant being administered with AK-OTOF in a Phase 1 or Phase 1/2 trial on or prior to Dec. 31, 2024; (ii) $1.00 in cash, upon the fifth (5th) participant being administered with an Akouos gene therapy product for a second monogenic form of sensorineural hearing loss (excluding AK-OTOF and AK-antiVEGF) on or prior to Dec. 31, 2026; and (iii) $1.00 in cash, upon (a) the first (1st) participant being administered with an Akouos gene therapy product (excluding AK-antiVEGF) for a monogenic form of sensorineural hearing loss in a Phase 3 trial, or (b) receipt of FDA approval in the U.S. for suchAkouos product, whichever occurs first, on or prior to Dec. 31, 2026, or its value will be reduced by approximately 4.2 cents per month until Dec. 1, 2028 (at which point the CVR will expire). There can be no assurance that any payments will be made with respect to the CVR.

For Lilly, Kirkland & Ellis LLP is acting as legal counsel. For Akouos,Wilmer Cutler Pickering Hale and Dorr LLP is acting as legal counsel and Centerview Partners LLC is acting as sole financial advisor.