On the evening of July 8, Beijing time, after the US stock market opened, US biopharmaceutical companies$Morphic (MORF.US)$At one point, the stock price soared by more than 75%. According to the news, biomedical giants$Eli Lilly and Co (LLY.US)$The company officially announced that it will acquire Morphic in cash at a price of 57 US dollars/share, a 79% premium over last Friday's closing price. The deal is expected to be completed in the third quarter of 2024. Morphic rose 75.5% to $55.735 as of press time.

Analysts pointed out that the main intention of Eli Lilly's acquisition of Morphic at a high premium was probably to increase the IBD (inflammatory bowel disease) circuit. According to reports, Morphic is a biopharmaceutical company developing oral integrin therapy. Its major project is a selective oral α4β7 integrin small molecule inhibitor to treat inflammatory bowel disease, which may improve patients' prognosis and expand treatment options.

It is worth mentioning that, benefiting from the explosion of the diet medicine circuit, Lilly's stock price continued to soar, with a cumulative increase of about 60% during the year. The latest total market value was about 870 billion US dollars (about 6,300 billion yuan), making it one of the pharmaceutical companies with the highest market capitalization in the world.

75% increase

On the evening of July 8, Beijing time, after the opening of US stocks, the US biopharmaceutical company Morphic's stock price once soared by more than 75%. According to the news, Eli Lilly agreed to buy Morphic Holding Inc. for approximately $3.2 billion to obtain experimental treatments for inflammatory bowel disease and other chronic diseases.

Eli Lilly announced on Monday that it will buy Morphic in cash at a price of 57 US dollars/share, a 79% premium over last Friday's closing price.

The deal has been approved by the boards of both companies, is not subject to any financing conditions and is expected to close in the third quarter of 2024.

Morphic's major project is a selective oral α4β7 integrin small molecule inhibitor for the treatment of inflammatory bowel disease (IBD), which has the potential to improve patient prognosis and expand treatment options. This molecule (known as MORF-057) is being evaluated in two phase 2 studies of ulcerative colitis and a phase 2 study of Crohn's disease.

Ulcerative colitis is a disease that causes chronic inflammation of the gastrointestinal tract. Ulcerative colitis is a type of inflammatory bowel disease. Patients may experience symptoms including diarrhea, abdominal pain, bloody stools, rectal bleeding, weight loss, and fatigue. According to reports, there are about millions of patients with ulcerative colitis, which seriously affects the quality of life of patients.

Last year, the US Food and Drug Administration (FDA) approved Eli Lilly's Omvoh for adult patients with ulcerative colitis. In addition to Mounjaro and Zepbound, this is one of Eli Lilly's most marketable drugs.

Additionally, Morphic is developing preclinical pipelines for other molecules to treat autoimmune diseases, pulmonary hypertension disease, fibrosis disease, and cancer.

Regarding this acquisition, Dr. Daniel Skovronsky, chief scientific officer of Eli Lilly and president of Eli Lilly's Immunology, said that oral therapy can open up new possibilities for early intervention in diseases such as ulcerative colitis, and also provides potential for combination treatment to help patients with more serious diseases. This strategic deal reinforces Eli Lilly's commitment to develop new treatments in the field of gastroenterology, where Eli Lilly has invested heavily to provide first-class molecular medicines and benefit patients.

Morphic Therapeutics CEO Praveen Tipirneni, M.D., said Morphic believes that MORF-057's huge potential to benefit IBD patients can be optimized through an ideal strategic partner. Eli Lilly brings unrivaled resources and commitment to the field of inflammation and immunology.

Praveen Tipirneni further stated that the company has established the Morphic Integrin technology platform to realize huge opportunities for integrin therapy. MORF-057 is a good example. It is an oral small molecule α4β7 inhibitor with good tolerability and efficacy, and can bring new possibilities for IBD treatment. The company eagerly looks forward to the rapid development of MORF-057 and other integrin drugs under the management of Eli Lilly.

In addition to Eli Lilly,$ROCHE HOLDING AG (RHHBY.US)$,$Merck & Co (MRK.US)$Other pharmaceutical giants are also developing the field of inflammatory bowel disease. Last year, Roche announced that it would buy it at a price of 7 billion US dollars$Roivant Sciences (ROIV.US)$The TL1A antibody RVT-3101; MSD acquired Prometheus Biosciences for $10.8 billion and obtained its core pipeline TL1A antibody PRA023.

The heavy layout of the 6 trillions giant

According to reports, Eli Lilly is a global pharmaceutical giant based on research and development, and is headquartered in Indianapolis, Indiana, USA. The company's business scope is broad, covering many treatment fields, including but not limited to diabetes, cancer, Alzheimer's disease, rheumatoid arthritis, obesity, and inflammatory diseases.

As a global innovative drug giant, Eli Lilly has a strong patent layout around the world, particularly on core technologies or key drugs. Eli Lilly's R&D pipeline is very rich. The types of products involved include but are not limited to macromolecule product patents, dosage form patents, new use patents, drug combination patents, etc.

It is worth mentioning that Eli Lilly's layout on the booming diet medicine circuit is also very advanced. It developed a GLP-1/GIP dual agonist of tirpotide (trade name: Mounjaro) to treat type 2 diabetes and was approved by the US Food and Drug Administration (FDA) for chronic weight management in 2023.

On May 21 this year, according to information published on the official website of the China National Drug Administration, the marketing application for tirzepatide (tirzepatide) injections developed by Eli Lilly has been approved. It has been approved for the treatment of blood sugar control in adults with type 2 diabetes.

Analysts pointed out that Eli Lilly's intention to acquire Morphic at a high premium may be to lay out integrin therapy. At present, the biological function and mechanism of action of integrins have gradually been clarified, and research on cancer progression is also deepening.

Integrins are a class of transmembrane proteins containing an alpha subunit and a beta subunit. Both form heterologous dimers through non-covalent bonds. It has now been discovered that 18 alpha subunits and 8 beta subunits together form 24 integrin proteins. These proteins are widely distributed on the surface of human cells, are responsible for attachment and signal transmission between cells, and are closely related to cell growth, differentiation, and migration.

Integrins are involved in many diseases, such as platelet disorders, atherosclerosis, cancer, osteoporosis, fibrosis, renal diabetic neuropathy, macular degeneration, etc. Therefore, integrins were once considered one of the most important targets in drug development.

Biological research in this field has once promoted the development of related drugs, which have been approved to treat various diseases including complications such as multiple sclerosis, renal diabetic neuropathy, and osteoporosis. Numerous studies have confirmed that integrins have a critical regulatory effect in cardiovascular diseases, ophthalmologic diseases, and fibrous diseases, fully demonstrating the potential for developing new drugs using integrins as drug targets.

Currently, there are about 90 integrin-based drugs in clinical research, and they cover a wide range of indications, including cancer, cardiovascular diseases, autoimmune diseases, etc.

Editor/Jeffrey