Lilly strengthens IBD portfolio with $3.2 billion acquisition of Morphic

Eli Lilly has signed a definitive agreement to acquire Morphic Holding for $3.2 billion, expanding its inflammatory bowel disease (IBD) treatment portfolio.

The deal — expected to close in the third quarter of 2024 — will give Lilly the lead asset in Morphic, MORF-057. The candidate is being studied in two Phase II trials for ulcerative colitis and one Phase II trial for Crohn’s disease. The small-molecule drug inhibits α4β7, an integrin expressed on some white blood cells.

With this deal, Lilly aims to challenge Takeda’s blockbuster Entyvio (vedolizumab), which won U.S. Food and Drug Administration (FDA) approval in April 2014 for the treatment of IBD. Entyvio is also an α4β7 inhibitor that has anti-inflammatory effects in the gut and controls IBD symptoms. But the oral form of MORF-057, compared with the intravenous and current injectable versions of Entyvio, could open up new market opportunities for Lilly, as some patients prefer oral medications for their ease of use.

IBD is an umbrella term for two chronic conditions, Crohn’s disease and ulcerative colitis, that cause inflammation in the digestive tract. GlobalData estimates that the Crohn’s disease and ulcerative colitis markets will be worth $25.5 billion and $14.7 billion, respectively, by 2032.

GlobalData is the parent company Pharmaceutical technology.

Lilly already has an IBD drug in the pipeline, Omvoh (mirikizumab), an interleukin (IL)-23 therapy that won FDA approval for ulcerative colitis in October 2023. Omvoh is expected to generate sales of $939 million in 2030, according to GlobalData’s Pharma Intelligence Center.

The IBD field is fairly crowded, with AbbVie’s Humira (adalimumab) being the top earner. However, there is still potential for oral formulations of drugs such as Bristol Myers Squibb’s (BMS) Zeposia (ozanimod) and AbbVie’s Rinvoq (upadacitinib).

In the announcement accompanying the acquisition, Daniel Skovronsky, Lilly’s chief scientific officer, said: “Oral therapies could open up new avenues for earlier intervention in diseases such as ulcerative colitis, as well as provide the potential for combination therapy to help patients with more severe disease.”

This latest deal follows a series of high-profile acquisitions from Lilly in the past year, including DICE Therapeutics for $2.4 billion in June 2023, where it acquired a preclinical oral α4β7 program. In October 2023, Lilly signed a definitive agreement to acquire radiopharmaceutical company POINT Biopharma for $1.4 billion in cash.

The article, “Lilly bolsters IBD portfolio with $3.2 billion acquisition of Morphic,” was originally created and published by Pharmaceutical Technology, a GlobalData brand.

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