Eli Lilly Comes Out Swinging

Eli Lilly Comes Out Swinging

The annual J.P. Morgan Healthcare conference in San Francisco concluded last week with very few big deal announcements. In January 2019, Bristol-Myers Squibb (NYSE: BMY) made its $74 billion takeover of Celgene Corporation (NASDAQ: CELG) public just before the conference started. That was quickly followed by Eli Lilly and Company’s (NYSE: LLY) $8 billion deal for Loxo Oncology. This year, Eli Lilly was back in the spotlight with an agreement to acquire Demira, Inc. (NASDAQ: DERM), the largest deal announced in January. The $1.1 billion cash price (13.3x revenue), or $18.75 a share, represents an 86% premium to the 60-day volume-weighted average trading price of Dermira’s stock... Read More »
Eli Lilly Acquires Loxo Oncology in its Largest Deal Yet

Eli Lilly Acquires Loxo Oncology in its Largest Deal Yet

Eli Lilly and Company (NYSE: LLY) hit the new year running when it announced the acquisition of Loxo Oncology, Inc. (NASDAQ: LOXO), a biopharmaceutical company that develops medicines for genomically defined cancers. Under the terms of the deal, Lilly will acquire all outstanding shares of Loxo for $235.00 per share, or $8 billion. The offer represents a premium of approximately 68% to Loxo’s closing stock price on January 4, 2019. On a trailing 12-month basis, Loxo reported revenue of $144.8 million, for a multiple of nearly 55.3x. This marks the company’s largest acquisition, by price, since 2008, when the Indianapolis-based drug maker paid $6.5 billion, or 10.4x revenue, for... Read More »
Eli Lilly Doubles Down on Immuno-Oncology

Eli Lilly Doubles Down on Immuno-Oncology

ARMO BioSciences (NASDAQ: ARMO) is a late-stage immuno-oncology company that develops a pipeline of novel, proprietary product candidates designed to activate the immune system of cancer patients to recognize and eradicate tumors. On a trailing 12-month basis, it generated a net loss of $42.4 million. Eli Lilly and Company (NYSE: LLY) overlooked the loss as it eyed the real prize–the addition of pegilodecakin, a PEGylated IL-10, which has demonstrated clinical benefits as a single agent, and in combination with both chemotherapy and checkpoint inhibitor therapy, across several tumor types. Pegilodecakin is currently being studied in a Phase 3 clinical trial in pancreatic cancer, and... Read More »

MCOs Make Deals to Combat High Drug Costs

The rising cost of prescription drugs was part of many candidates’ campaign platforms in the 2016 national elections. The topic has not gone away, and is certainly a factor in the dearth of Big Pharma deals in 2017.  Through June 15, M&A in the Pharma sector is down 43%, to 44 transactions, compared with the same period in 2016, which had 77 transactions. Spending is also down in for the first six months of 2017. Through June 15, acquirers announced $19.2 billion in committed financing, down 66% from the same period in 2016, when approximately $56.5 billion was spent. There are deals being done, regarding this issue, but most are not M&A. In fact, several managed care... Read More »

Pharma Deals Slid in Q1:17

Deal making in the pharmaceutical sector slid further in the first quarter, down 12% to 29 deals, compared with the previous quarter, and down 28% compared with the same quarter a year ago. This quarter’s deal volume accounts for 20% of the 145 deals announced in the previous 12 months. President Trump has continued to malign this sector in social media tweets and in public speeches for the high price of some drugs, so it’s not surprising to see M&A slacking off, for the time being. Also, drug makers’ attention is directed toward their aging product pipelines, and most of the deal activity is going to acquire the rights to promising mid- and late-phase drug candidates. Source:... Read More »