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Lilly to Acquire Morphic Therapeutic in $3.2B Deal Boosting IBD Portfolio

Lilly to Acquire Morphic Therapeutic in $3.2B Deal Boosting IBD Portfolio

Morphic Therapeutic’s MORF-057, a promising oral integrin inhibitor, will join Lilly's IBD portfolio.

Eli Lilly and Company announced plans to acquire Morphic Holding, Inc., a biopharmaceutical firm specializing in oral therapies for chronic diseases. This $3.2 billion acquisition is set to expand Lilly’s immunology pipeline and hopefully improve treatment options for those with inflammatory bowel diseases (IBD), including ulcerative colitis and Crohn’s disease which are chronic inflammatory conditions affecting the gastrointestinal tract.

Lilly will buy all outstanding shares of Morphic at $57 per share in cash, a 79 percent premium to the closing stock price on July 5, 2024. The transaction, expected to close in the third quarter of 2024, includes a second-step merger for non-tendered shares.

“Oral therapies could open up new possibilities for earlier intervention in diseases like ulcerative colitis and also provide the potential for combination therapy to help patients with more severe disease,” said Dr. Daniel Skovronsky, chief scientific officer of Lilly, in the news release. He highlighted that this acquisition fits with Lilly’s commitment to innovative treatments in gastroenterology and immunology.

Dr. Praveen Tipirneni, CEO of Morphic Therapeutic, emphasized MORF-057’s potential to benefit IBD patients. “MORF-057 is a tremendous example of those efforts, an oral small molecule α4β7 inhibitor with the potential to be well tolerated and efficacious, attributes that could unlock new possibilities in IBD treatment,” he stated.

Morphic Therapeutic is known for its innovative approach to developing oral integrin therapies. Integrins are receptors that mediate key interactions between cells and their environment, and Morphic’s proprietary Morphic Integrin Technology (MInT) platform enables the precise modulation of integrin activity to treat disease.


Related: First Stelara Biosimilar, Wezlana, Gets FDA Nod for Crohn’s, UC, Psoriasis but Faces Delayed Launch


New IBD Treatments with MORF-057

Morphic’s top candidate, MORF-057, is an oral small molecule that inhibits α4β7 integrin, a proven target for IBD treatment. Similar to Takeda’s injectable Entyvio (vedolizumab), MORF-057 prevents harmful interactions between T-cells and intestinal tissues, reducing inflammation. MORF-057 is currently in Phase II trials for ulcerative colitis and Crohn’s disease, with further preclinical research targeting other autoimmune and fibrotic diseases, as well as cancer.

The EMERALD Phase II program for MORF-057 in moderate-to-severe ulcerative colitis has shown positive results. The EMERALD-1 Phase IIa study met its main goal, showing significant improvements and no safety issues. The ongoing EMERALD-2 Phase IIb global trial, focused on moderate-to-severe ulcerative colitis, is expected to report results in the first half of 2025.

Phase I studies of MORF-057 demonstrated a good safety profile, with more than 99 percent receptor occupancy in multiple dose cohorts. Preclinical results suggest MORF-057 as a promising oral option, similar to vedolizumab.

Global Burden of IBD

The Global Burden of Disease Study (GBD) 2019 highlighted the increasing global burden of IBD, with cases rising from 3.3 million in 1990 to 4.9 million in 2019. Despite this increase, the age-standardized global prevalence has declined, indicating improvements in disease management. China and the US had the highest number of IBD cases, with 911,405 and 762,890 cases, respectively, in 2019.

The global IBD treatment market generated $20.7 billion in 2023 and is projected to grow at a 4.2 percent annual rate, reaching $27.7 billion by 2030. The rising prevalence of ulcerative colitis and Crohn’s disease is a key driver, with Crohn’s disease leading the segment in 2023 with a 60.6 percent revenue share. The US led the global market in 2023, accounting for $11.4 billion.

Online pharmacies are expected to be the fastest-growing distribution channel of IBD treatments, with a 5.9 percent annual growth rate. Leading companies, including AbbVie, Takeda, Pfizer and Biogen, are at the forefront of product innovation and development.

Given the significant burden of IBD, early diagnosis and appropriate treatment are crucial. Delays in diagnosis can lead to poor outcomes, making timely initiation of therapy vital.

Morphic Therapeutic’s acquisition is a significant step in expanding Lilly’s immunology pipeline, encouraging new, effective and patient-friendly treatments for chronic diseases, particularly IBD. The integration of Morphic’s innovative therapies with Lilly’s extensive resources and expertise holds great potential for advancing patient care in gastroenterology and beyond.