Tag: LLY

Eli Lilly Acquires Organovo’s FXR Program in Strategic Expansion

Posted on by slightbourne@noblecapitalmarkets.com
Key Points:
– Eli Lilly (LLY) is acquiring Organovo’s (ONVO) FXR program, including lead drug candidate FXR314, for further development.
– Organovo will receive an upfront payment along with milestone-based regulatory and commercial payouts.
– ONVO stock surged over 200% following the announcement.

In a significant move for the biotechnology sector, Organovo Holdings, Inc. (Nasdaq: ONVO) announced the sale of its FXR program, including its lead candidate FXR314, to pharmaceutical giant Eli Lilly and Company (NYSE: LLY). The acquisition, disclosed on Tuesday, marks a pivotal moment for Organovo as it aligns its proprietary 3D human tissue technology with a global leader in drug development.

The FXR program, focused on inflammatory bowel disease (IBD), is a major step toward advancing novel treatment approaches. Organovo’s Executive Chairman, Keith Murphy, expressed confidence in Lilly’s ability to further develop FXR314, highlighting the company’s world-class expertise and commitment to patient care.

Under the agreement, Organovo will receive an upfront cash payment, with additional milestone payments contingent on regulatory approvals and commercial success. While the specific financial terms remain undisclosed, the market’s response has been overwhelmingly positive.

Following the announcement, ONVO shares skyrocketed by over 200%, reflecting investor optimism about the deal’s potential impact. Lilly’s stock also saw a modest gain of 2.32% as the acquisition strengthens its pipeline in the IBD treatment space.

For Organovo, this transaction reinforces its ability to leverage its cutting-edge 3D tissue technology for drug development partnerships. The company, known for pioneering bioprinting innovations, has been positioning itself as a key player in personalized medicine and regenerative therapies.

For Eli Lilly, the acquisition aligns with its broader strategy of expanding its immunology portfolio. FXR314’s development complements Lilly’s existing research efforts in inflammatory diseases, further cementing its position as a leader in next-generation therapeutics.

With FXR314 now under Lilly’s stewardship, the biotech industry will closely monitor its progression into Phase 2 trials. If successful, the drug could represent a breakthrough in IBD treatment, addressing a significant unmet medical need.

As Organovo pivots towards future innovation, and Lilly integrates this promising asset into its pipeline, investors and analysts alike will be watching closely to gauge the long-term benefits of this high-profile acquisition.

Take a moment to take a a look at Noble Capital Markets’ biotechnology Research Analyst Robert LeBoyer’s coverage list.

Behind the Scenes of Biotech’s Battle for the Billion-Dollar Diet Pill

Posted on by slightbourne@noblecapitalmarkets.com

For biotech investors scouring for the next big opportunity, the massive manufacturing expansions underway at pharma giant Eli Lilly (LLY) are worth a close look. The company just announced another staggering $5.3 billion investment into a key production facility in Indiana to crank up supply of its blockbuster obesity and diabetes drugs.

This commitment brings Lilly’s total investment at the Lebanon, Indiana site to an incredible $9 billion – representing the firm’s largest-ever manufacturing bet in its nearly 150-year history. It highlights the huge demand that Lilly’s game-changing medications like Mounjaro and Zepbound are facing from physicians and patients alike.

For small biotech firms developing the next generation of weight loss, diabetes and metabolism therapies, Lilly’s supply chain moves send an important signal – this market is headed for explosive growth in the coming years. Companies sitting on promising pipeline candidates could emerge as attractive buyout targets.

At the heart of Lilly’s expansion plans are its incretin drugs, which mimic gut hormones to suppress appetite and regulate blood sugar. Mounjaro, approved for diabetes, and Zepbound, greenlit for chronic weight management, both contain the active ingredient tirzepatide.

Since their launches, demand for these effective and convenient once-weekly injectable treatments has far outstripped supply. Shortages have been widespread in the U.S. as Lilly raced to build out its production infrastructure.

The new $9 billion Indiana campus will be instrumental in increasing Lilly’s capacity to manufacture tirzepatide at scale. When fully operational in 2028, it will employ around 900 skilled workers including scientists, engineers and technicians.

But this plant is just one piece of Lilly’s supply chain mobilization for incretin drugs. Since 2020, the company has plowed over $18 billion into building, acquiring and expanding manufacturing sites in the U.S. and Europe. New facilities are also coming online in North Carolina, Ireland and Germany through 2026.

These investments are already paying dividends. On its latest earnings call, Lilly hiked its 2023 revenue guidance by $2 billion, citing greater visibility into ramping up production of Mounjaro, Zepbound and its incretin pipeline over the remainder of the year.

For small biotechs, the supply chain frenzy at Lilly underscores the commercial opportunity in obesity, diabetes and metabolism. With over 40% of U.S. adults classified as obese, safe and effective chronic weight management regimens like Lilly’s incretin franchise could disrupt a massive global market worth billions annually.

Take a moment to look at more emerging growth biotechnology companies by taking a look at Noble Capital Markets’ Senior Research Analyst Robert LeBoyer’s coverage list.

The manufacturing expansions suggest appetite for these therapies will continue to surge, fueling demand for the next generation of medications offering better efficacy, tolerability and dosing schedules. Smaller drug developers operating in this space could become prime M&A candidates as deep-pocketed pharmas look to build out their obesity and diabetes portfolios.

Case in point: Lilly itself acquired Zepbound through its $8 billion buyout of Protunor Biopharma in 2022. Several major deals have already reshaped the incretin drug landscape in recent years, including Pfizer’s $6.7 billion purchase of Akero Therapeutics for its NASH/diabetes pipeline.

With its bold investments, Lilly is putting its money where its mouth is when it comes to obesity and metabolic disease. For lean biotechs advancing the next wave of therapies in this booming treatment category, that could spell opportunity knocking in the form of lucrative buyout offers or partnerships down the line.

Keep an eye on this space as Lilly’s supply chain moves underscore that the fight against fat is only just beginning for the pharmaceutical industry.