Eli Lilly is spending about $8 billion in cash to buy Loxo Oncology, as the drugmaker bulks up on cancer treatments that target certain gene abnormalities.

Loxo Oncology could launch a drug next year and targets an abnormality that occurs in several tumor types, including some lung and thyroid cancers, Lilly said in a prepared statement announcing the deal Monday.

Lilly, known for insulins like Humalog, has emphasized oncology growth over the past several years, and one of its top-selling products is the cancer treatment Alimta.

Eli Lilly and Co. will pay $235 for each share of Stamford, Connecticut-based Loxo. That's a 68 percent premium to the company's Friday closing price of $139.87.

The deal is expected to close by the end of the first quarter.

Lilly's announcement was the second big pharmaceutical acquisition announced in the new year. It follows a $74-billion acquisition of Celgene by Bristol-Myers Squibb announced last week.

Shares of Eli Lilly, based in Indianapolis, fell nearly 3 percent to $111.39 in Monday premarket trading.