An Eli Lilly office in San Diego, Calif., on Sept. 17, 2020.Mike Blake/Reuters
Eli Lilly LLY-N will acquire Morphic Holding MORF-Q for $3.2-billion in cash, the companies said on Monday, giving the U.S. drugmaker access to an experimental drug for types of inflammatory bowel diseases.
Shares of drug developer Morphic surged 76 per cent to $56.15 premarket on Lilly’s offer of $57 per share, which represents a 79 per cent premium to stock’s last closing price.
Morphic’s lead drug MORF-057 is an oral treatment that is being evaluated in two phase 2 studies in ulcerative colitis patients and one phase 2 study in Crohn’s disease.
Ulcerative colitis is a condition where abnormal reactions of the immune system cause inflammation and ulcers on the inner lining of the colon, which can lead to diarrhea, passing of blood with stool and abdominal pain.
Last year, the U.S. Food and Drug Administration approved Lilly’s Omvoh for treating adults with moderate-to-severe active ulcerative colitis.
The drug is among Lilly’s potential growth drivers for this decade alongside its diabetes and obesity drugs, Mounjaro and Zepbound.
Other drugmakers such as Abbvie Inc, Pfizer and Johnson & Johnson are also jostling for a share of the multi-billion dollar bowel disease market.