Zepbound-maker Eli Lilly (NYSE:LLY) is acquiring biopharmaceutical company Morphic Holding (NASDAQ:MORF) at $57 per share. The announcement of the $3.2 billion deal has pushed Morphic’s share price nearly 75% higher today.
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Pipeline Boost for Eli Lilly
Morphic is developing oral integrin therapies for the treatment of serious chronic diseases. The strategic acquisition promises to expand LLY’s immunology pipeline with MORF’s therapies. MORF’s lead product candidate, MORF-057, is currently in two Phase 2 trials for ulcerative colitis and one Phase 2 trial for Crohn’s disease, targeting inflammatory bowel disease (IBD).
Importantly, MORF’s preclinical product pipeline also includes candidates for treating autoimmune diseases, pulmonary hypertensive diseases, fibrotic diseases, and cancer.
The Deal
Under the deal, LLY will launch a tender offer for all outstanding shares of Morphic. The $57 per share price tag implies a total deal value of roughly $3.2 billion. Moreover, the deal has received approval from the boards of both companies.
Furthermore, the acquisition price represents an 87.2% premium over MORF’s Volume Weighted Average Price (VWAP) over the past 30 days. As a result, shares of the company are skyrocketing today. Eli Lilly expects the transaction to close in the third quarter of this year.
What Is the Price Forecast for LLY Stock?
Meanwhile, Eli Lilly shares are in the midst of a rally of their own with a gain of around 104% over the past year. Overall, the Street has a Strong Buy consensus rating on the stock, alongside an average LLY price target of $892.29.
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