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The Zacks Analyst Blog Highlights J&J, Eli Lilly, GSK and Intra-Cellular

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For Immediate Release

Chicago, IL – January 15, 2025 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: J&J (JNJ - Free Report) , Eli Lilly (LLY - Free Report) , GSK (GSK - Free Report) and Intra-Cellular Therapies .

Here are highlights from Tuesday’s Analyst Blog:

JNJ, GSK, LLY Announce M&A Deals at JPMorgan Conference

The JP Morgan Healthcare Conference, which is being held in San Francisco this year, has been much more active than last year. Among some of the top news at the conference were M&A deal announcements by J&J, Eli Lilly and GSK.

While J&J announced a big deal to acquire neuroscience company Intra-Cellular Therapies, Lilly and GSK announced smaller deals.

J&J Offers to Buy ITCI for $14B

The drug and medical devices giant entered into a definitive agreement to acquire Intra-Cellular Therapies for $132.00 per share or approximately $14.6 billion. The offer price represents a premium of almost 40% to ITCI’s closing price on Friday.

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 CNS candidates, including ITI-1284, being developed in phase II for generalized anxiety disorder and Alzheimer’s disease-related psychosis and agitation, to JNJ’s portfolio.

Lilly to Buy Scorpion’s PI3Kα Inhibitor for Breast Cancer

Eli Lilly announced that it is buying private biotech Scorpion Therapeutics’ novel mutant-selective PI3Kα inhibitor, STX-478, being developed in a phase I/II study for breast cancer and other advanced solid tumors. The acquisition will stregthen 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 spinning it off into a new independent company. Scorpion’s current shareholders will own the new company, and Lilly will have a minority stake.

GSK Targets Gastrointestinal Cancers With IDRx Acquisition

GSK, meanwhile, announced an agreement to acquire private biotech IDRx, which makes precision therapeutics for treating gastrointestinal stromal tumors (GIST). IDRx’s key pipeline candidate is IDRX-42, a highly selective KIT tyrosine kinase inhibitor (TKI), which has shown the potential to address all key KIT mutations in GIST that drive tumor growth. For the deal, GSK will make an upfront payment of $1 billion and $150 million in a potential regulatory milestone payment in cash.

M&A to Pick Up in 2025?

The acquisition announcements set the tone for a potential rebound in M&A deals in the healthcare sector in 2025 after a rather muted performance in 2024. There were no big acquisition announcements in 2024 from the large drugmakers. Some of the larger M&A deals of 2024 were Vertex’s buyout of Alpine Immune Sciences, Eli Lilly’s buyout of Morphic and Novo Nordisk’s acquisition of Catalent. However, M&A activity is expected to pick up in 2025, particularly with Trump’s return to the White House. Fast-growing and lucrative markets such as rare diseases, next-generation oncology treatments, obesity, immunology and neuroscience are likely to remain focus areas for M&A activities.

All the big drugmakers have R&D pipelines to fill, as their internal candidates are not sufficient to compensate for the upcoming loss of exclusivity of their blockbuster products. Smaller deals are expected to be more frequent while the likelihood of multibillion-dollar deals is less.

Zacks Rank

J&J has a Zacks Rank #2 (Buy), while Lilly and ITCI have a Zacks Rank #3 (Hold) each. GSK has a Zacks Rank #5 (Strong Sell).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.


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