JNJ will buy Intra-Cellular Therapies, producer of a drug for bipolar disorder, for $14.6 billion.
Eli Lilly (LLY) announced disappointing preliminary sales numbers, lowering its investor guidance for Q4.
Meanwhile, Pfizer announced that a study evaluating a bladder cancer drug met a critical testing milestone.
This week, J&J JNJ announced the first big acquisition of 2025 for the drug/biotech sector as it offered to buy Intra-Cellular Therapies for $14.6 billion. Eli Lilly LLY announced disappointing preliminary sales numbers for the fourth quarter. AstraZeneca AZN and partner Daiichi Sankyo’s application seeking approval of datopotamab deruxtecan (Dato-DXd) for a lung cancer indication was granted priority review by the FDA. Pfizer PFE announced positive data from a pivotal study on sasanlimab, a subcutaneously administered PD-1 inhibitor in a bladder cancer indication. AbbVie ABBV announced a new cancer deal.
Here's a recap of the week’s most important stories.
J&J Offers to Buy ITCI for $14.6B
J&J announced a definitive agreement to acquire Intra-Cellular Therapies for $132.00 per share or approximately $14.6 billion. The offer price represented a premium of almost 40% to ITCI’s closing price on Jan. 10.
The acquisition will add Intra-Cellular Therapies’ only approved drug, Caplyta, for the treatment of bipolar I and II depression and schizophrenia, to J&J’s neuroscience pipeline. ITCI has also filed a supplemental new drug application (sNDA) to the FDA seeking approval of Caplyta as an adjunctive treatment for major depressive disorder. Additional phase III studies are ongoing on Caplyta in other mental health disorders
The acquisition will also add Intra-cellular Therapeutics’ other central nervous system candidates, including ITI-1284, being developed in phase II for generalized anxiety disorder and Alzheimer’s disease-related psychosis and agitation.
J&J began the submission of a new drug application (NDA) with the FDA for TAR-200, its innovative intravesical drug releasing system for the treatment of patients with Bacillus Calmette-Guérin (BCG)-unresponsive, high-risk non-muscle-invasive bladder cancer (HR-NMIBC). The application was accepted for FDA’s real-time oncology review. The NDA was based on data from the phase IIb SunRISe-1 study
LLY’s Q4 Preliminary Sales Number Disappoints
Lilly lowered its sales guidance for full-year 2024 and announced disappointing preliminary sales numbers for the fourth quarter. Lilly expects revenues to be approximately $45.0 billion in full-year 2024, which falls short of its previous guidance range of $45.4 billion to $46.0 billion.
In the fourth quarter, revenues are expected to be approximately $13.5 billion, which fell short of the consensus estimate due to lower-than-expected sales of its popular GLP-1 drugs, Mounjaro, for type II diabetes and Zepbound for obesity. Lilly said it generated approximately $3.5 billion in sales from Mounjaro and $1.9 billion from Zepbound, which fell short of the consensus estimate, raising concerns about the sky-high expectations for these drugs.
The company also issued its total revenue guidance for 2025. In 2025, Lilly expects to record revenues in the range of $58.0 billion to $61.0 billion, indicating growth of 32% at the midpoint of the 2024 expected range
Eli Lilly announced that it is buying private biotech, Scorpion Therapeutics’ novel mutant-selective PI3Kα inhibitor, STX-478, which is being developed in a phase I/II study for breast cancer and other advanced solid tumors. The acquisition will strengthen Lilly’s oncology pipeline. The total deal value is approximately $2.5 billion in cash, which includes an upfront payment and subsequent potential milestone payments.
Lilly is taking the STX-478 program and then spinning it off into a new independent company, which will be owned by Scorpion’s current shareholders. Lilly will have a minority stake in the new company.
The FDA approved Lilly’s Omvoh for treating moderately to severely active Crohn's disease (“CD”), expanding its use to the second major type of inflammatory bowel disease (IBD) condition, an area gaining immense popularity. Omvoh was approved for its first IBD indication, moderately to severely active ulcerative colitis (“UC”), in 2023. Lilly has also filed applications seeking approval of Omvoh for CD in several countries including the EU and Japan.
PFE’s Bladder Cancer Study on PD-1 Inhibitor Meets Goal
Pfizer announced that a pivotal phase III study evaluating sasanlimab, a subcutaneously administered PD-1 inhibitor, for treating BCG-naïve, high-risk non-muscle invasive bladder cancer, met its primary endpoint of event-free survival (EFS). Data from the study showed that sasanlimab in combination with BCG demonstrated a clinically meaningful and statistically significant improvement in EFS compared to BCG alone (induction and maintenance). Treatment naïve high-risk NMIBC is an area of significant unmet need as the initial therapy for this cancer, which has high rates of recurrence and progression, has not advanced in decades. Pfizer plans to discuss the data with global health authorities to support regulatory filings.
FDA’s Priority Tag to AZN/Daiichi’s Dato-DXd for NSCLC
AstraZeneca and partner Daiichi Sankyo announced that the FDA has granted a priority review designation to their biologics license application (BLA) seeking accelerated approval of Dato-DXd for previously treated advanced EGFR-mutated non-small cell lung cancer (“NSCLC”). The BLA was based on data from the TROPION-Lung05 phase II study. The FDA’s decision is expected during the third quarter of 2025.
In November, based on the FDA’s feedback, AstraZeneca and Daiichi Sankyo withdrew their earlier application seeking accelerated approval of Dato-DXd for nonsquamous NSCLC and instead filed a new BLA for Dato-DXd for previously treated advanced EGFR-mutated NSCLC. The companies are also seeking approval for Dato-DXd for HR+ HER2- breast cancer in both the United States and the EU.
ABBV’s New Deal With Chinese Biotech for Multiple Myeloma Drug
AbbVie announced an option to license a deal with Simcere Zaiming, a subsidiary of China’s Simcere Pharmaceutical Group, to develop SIM0500, a novel trispecific antibody candidate being developed in phase I study for relapsed or refractory multiple myeloma (MM). SIM0500 is being developed leveraging Simcere Zaiming's proprietary T-cell engager platform. For the deal, AbbVie will make an upfront payment plus potential milestone payments of up to $1.055 billion to Simcere Zaiming.
The NYSE ARCA Pharmaceutical Index declined 1% in the past five trading sessions.
Large Cap Pharmaceuticals Industry 5YR % Return
Large Cap Pharmaceuticals Industry 5YR % Return
Large Cap Pharmaceuticals Industry 5YR % Return
Here’s how the eight major stocks performed in the previous five trading sessions.
Zacks Investment Research
Image Source: Zacks Investment Research
In the last five trading sessions, J&J rose the most (3.8%), while Lilly declined the most (3.8%).
In the past six months, all stocks were in the red except AbbVie, which rose 1.5%. Novo Nordisk declined the most (36.0%).
(See the last pharma stock roundup here: FDA Updates for JNJ, GSK, PFE, NVO’s Expanded Deal)
What's Next in the Pharma World?
Watch this space for J&J's Q4 earnings results and regular pipeline and regulatory updates next week.
J&J has a Zacks Rank #2 (Buy), while Lilly, Pfizer, AbbVie and AstraZeneca have a Zacks Rank #3 (Hold) each. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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