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The pharmaceutical sector was waiting for the financial statements of the giant Eli Lilly to understand the market trend. And the signal was positive, since the American group beat analysts’ estimates in the fourth quarter of last year, but above all it gave 2024 estimates above the market consensus. In detail, the last quarter was closed with a profit per share of 2.49 dollars (+13%) against revenues of 9.35 billion, up 28%. For the current financial year, estimates are of earnings per share in the range between 11.80 and 12.30 dollars against a turnover of between 40.4 billion and 41.6 billion, compared to a consensus which indicated for 2024 turnover at 39 billion.
The biotech target
A solid foundation, therefore, on which to build diversification that allows sustainable growth in the medium and long term. So Eli Lilly, like all the big names in the sector, is shopping to identify research niches that could lead to new drugs. In 2023 alone it took over seven companies including the Canadian Point Biopharma for 1.4 billion, the French biotech Mablink and the American Versanis Bio for 1.93 billion.
The acquisition of Novartis
The field in which to compete with other large international groups is precisely that of biotech, which can bring advanced research into specific drugs into its portfolios. As Novartis did yesterday, announcing the acquisition of MorphoSys for 2.7 billion euros. The Swiss group is offering shareholders 68 euros per share in cash and, if the operation goes through, it will delist MorphoSys. The deal is subject to certain conditions, including a minimum acceptance threshold of 65% of MorphoSys’ share capital and regulatory approvals.
The shares of the German biotech, listed in Frankfurt, jumped by 38.6% on Monday and 43% yesterday, exceeding the offer price and ending the session at 68.20 euros. With the operation, Novartis adds pelabresib to its portfolio, a drug to fight forms of cancer such as myelofibrosis, a rare type of bone marrow cancer and some types of nodular lymphomas.
International shopping continues
And it is precisely the anticancer drugs sector that is currently most interesting for big pharmaceutical companies. In this context, Eli Lilly and Novartis have been the most active in the last 12 months, with seven and six deals respectively, according to Bloomberg data. The others, however, are not sitting on the sidelines and in this part of 2024 there are already six operations in the sector with a value over one billion, including the purchase by Sanofi of the US biotech Inhibrx for 2.2 billion and the Johnson & Johnson agrees to take over Ambrx Biopharma for $2 billion.