Pharmaceutical Technology

Lilly bolsters IBD portfolio with $3.2bn Morphic acquisition

Morphic’s lead asset MORF-057 is being investigated in three IBD clinical trials, with data in ulcerative colitis expected next year.

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

Through the deal – which is expected to close in Q3 2024 – Lilly will inherit Morphic’s lead asset, MORF-057. The candidate is under investigation in two Phase II studies for ulcerative colitis and one Phase II study for Crohn’s disease. The small molecule drug inhibits α4β7, an integrin expressed on some white blood cells.

With this deal, Lilly looks to challenge Takeda’s blockbuster drug Entyvio (vedolizumab), which bagged a US Food and Drug Administration (FDA) approval in April 2014 to treat IBD. Entyvio is also an α4β7 inhibitor shown to reduce inflammation in the gut and control symptoms of IBD. However, the oral format of MORF-057, compared to the intravenous and now injectable versions of Entyvio, may open up a new market opportunity for Lilly, with some patients preferring oral medications due to ease.

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

GlobalData is the parent company of Pharmaceutical Technology.

Lilly already has an IBD drug under its belt—anti-interleukin (IL)-23 therapy Omvoh (mirikizumab), which secured FDA approval for treating ulcerative colitis in October 2023. According to GlobalData’s Pharma Intelligence Center, Omvoh will generate $939m in sales in 2030.

The IBD field is quite crowded, with AbbVie’s Humira (adalimumab) being the top earner. However, there is still a potential preference for oral drug formulations like Bristol Myers Squibb’s (BMS) Zeposia (ozanimod), and AbbVie’s Rinvoq (upadacitinib).

In the announcement accompanying the acquisition, Lilly’s chief scientific officer Daniel Skovronsky said: “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.”

This latest deal comes after a flurry of high-profile acquisitions from Lilly last year, including DICE Therapeutics for $2.4bn in June 2023, where it inherited a preclinical oral α4β7 programme. In October 2023, Lilly signed a definitive agreement for the acquisition of radiopharmaceutical company POINT Biopharma for an all-in cash price of $1.4bn.