Hey,
It is possible by couple of ways:
1) Create an external table in either of the Production database:
https://learn.microsoft.com/en-us/azure/azure-sql/database/elastic-query-getting-started-vertical
Then in Azure data factory use a copy activity to have your query as source and your sink as the table 3 in database dev.
https://learn.microsoft.com/en-us/azure/data-factory/connector-sql-server
But based on the amount of data there might be performance issues due to elastic query so we can go with the below approach :
2) use data flow to join both the data from table 1 and table 2 and copy into table 3