Top 5 biggest M&A deals in the pharmaceutical industry as of August 14, 2023: Pfizer/Seagen ($43B), Biogen/Reata Pharmaceuticals ($7.3B), Astellas Pharma/Iveric Bio ($5.9B), Merck & Co./Prometheus Biosciences ($10.8B), Eli Lilly/Versanis ($1.93B).
Eli Lilly just wrapped up its acquisition of Versanis Bio in a $1.9 billion deal, the pharma giant announced today. The deal marks Lilly’s latest move to build up its pipeline of potential obesity and diabetes treatments, which promises to be a notable growth area for the company. Lilly recently completed its submission of tirzepatide for chronic weight management to the FDA.
The company reported positive Phase 3 results from the SURMOUNT-3 and SURMOUNT-4 studies, showing the highest levels of weight loss observed so far in the SURMOUNT program.
Tirzepatide is a dual glucose-dependent insulinotropic polypeptide (GIP) and glucagon-like peptide-1 (GLP-1) receptor agonist, which could ultimately fetch peak sales in the ballpark of $25 billion, according to UBS projections.
Acquiring Versanis Bio to strengthen obesity and diabetes treatment portfolio
Lilly’s latest acquisition gives it rights to Versanis’ lead drug bimagrumab, which Novartis first developed. The monoclonal antibody bimagrumab works by blocking activin receptors. Novartis initially developed it to treat pathological muscle loss and weakness.
In 2021, Versanis closed $70 million in Series A financing to develop bimagrumab for obesity. In a pooled analysis of five studies presented at ENDO 2022, the antibody helped obese patients shed more than 20% of their body fat while also gaining lean muscle mass. The drug entered phase 2b trials for obesity in early 2023.
Lilly intends to study using bimagrumab along with its own semaglutide injection Ozempic to see if the pairing is superior to either drug alone against obesity.
Versanis shareholders stand to receive up to $1.925 billion if bimagrumab succeeds in hitting certain milestones down the road.
How the Lilly-Versanis deal compares to the industry’s top transactions
This acquisition is part of a surge of M&A deals in the pharma industry this year.
This year has seen several monumental transactions that dwarf the Lilly deal in comparison. For instance, the Pfizer acquisition of Seagen for $43 billion, Amgen’s purchase of Horizon Therapeutics for $27.8 billion, and AstraZeneca’s takeover of Alexion Pharmaceuticals for $39 billion are significantly larger than the Lilly-Versanis transaction.
Regeneron recently announced a much smaller deal — the $213M acquisition of Decibel Therapeutics.