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The year in biotech M&A activity got off to a promising start at JPM Week with announcements of some multi-billion-dollar deals.
The flurry of networking in San Francisco between Jan. 13-16 also highlighted some of the trends that are likely to be hot topics as partnering activity continues at the next big biotech gathering, the Feb. 10-11 BIO CEO & Investor Conference in New York.
“Themes we’ve seen participants excited about at JPM Week include progress in the immunology space, continued investment in neuropsychiatric medicines, and applications of AI, not just in modeling the effectiveness of drugs but also for things like target selection and clinical trial recruitment,” said Bernard Fallon, Deputy VP of Industry Programs at the Biotechnology Innovation Organization (BIO).
The excitement seems likely to translate into deals, based on the record amount of activity on BIO’s partnering platform during JPM Week—four days of networking and dealmaking in San Francisco based around the J.P. Morgan Healthcare Conference and many parallel events.
Companies announce big deals
The biggest deal of the week was announced on opening day, Jan. 13. Johnson & Johnson said they had entered into an agreement to spend approximately $14.6 billion to acquire Intra-Cellular Therapies, whose once-daily oral drug CAPLYTA® (lumateperone) is approved by the Food and Drug Administration (FDA) to treat adults with schizophrenia, as well as bipolar depression.
As Johnson & Johnson noted, CAPLYTA® is also being considered for a further indication. In December, Intra-Cellular announced it had submitted a supplemental new drug application to the FDA for CAPLYTA® as an adjunctive treatment for adults with major depressive disorder (MDD) following successful Phase 3 clinical trials.
“CAPLYTA® has the potential to be the first treatment approved for MDD and depressive symptoms associated with bipolar I and II in more than 15 years,” said Johnson & Johnson’s announcement, which highlighted other promising drugs in Intra-Cellular’s pipeline.
Two other large deals announced on the Jan. 13 opening day involved oncology drugs.
Eli Lilly said it agreed with Scorpion Therapeutics, Inc. to acquire Scorpion’s PI3Kα inhibitor program STX-478 for as much as $2.5 billion. STX-478 is a once-daily oral drug currently being evaluated in a Phase 1/2 clinical trial for breast cancer and other advanced solid tumors.
“STX-478 could represent the next generation of PI3Kα targeting agents by selectively targeting the pathway in cancerous but not healthy cells, thus overcoming a key limitation of currently available medicines that target the PI3Kα pathway,” Eli Lilly said. “This approach could potentially offer better disease control through deeper pathway inhibition, as well as improved tolerability.”
GSK announced it agreed to spend $1 billion to acquire IDRx, a Boston-based clinical-stage biopharmaceutical company working on precision therapeutics for the treatment of gastrointestinal stromal tumors (GIST). IDRX is developing a molecule called IDRX-42 as a first- and second-line therapy for the treatment of GIST.
“Currently, there are no approved TKIs [KIT tyrosine kinase inhibitors] that inhibit the full spectrum of clinically relevant primary and secondary mutations in KIT,” said GSK’s announcement, which noted a “clear unmet medical need.”
Another deal in the oncology space announced Jan. 13 came from Ginkgo Bioworks, “which is building the leading platform for cell programming and biosecurity.” Ginkgo said they agreed to “a research collaboration with Universal Cells, an Astellas company, to optimize next-generation induced pluripotent stem cell (iPSC)-derived cancer cell therapies.”
As Ginkgo’s announcement explained, “This collaboration underscores Ginkgo’s capacity to deploy high-throughput biological approaches to tackle the complex challenge set associated with development of therapies targeting solid tumors.”
In a major deal announced Jan. 11, just before JPM Week began, Gilead Sciences, Inc. said it will partner with LEO Pharma to accelerate the development of LEO Pharma’s anti-inflammatory program. LEO Pharma’s program is said to show potential in targeting a range of inflammatory conditions, such as atopic dermatitis, asthma, and chronic obstructive pulmonary disease.
Gilead said LEO Pharma is eligible for up to $1.7 billion through the deal, which strengthens Gilead’s inflammation research portfolio.
Momentum expected to continue at BIO CEO 2025
These deals should be part of an improved year for M&A in biotech, following several years of slower activity, said a J.P. Morgan banker at the conference.
Jeremy Meilman, co-head of J.P. Morgan’s healthcare banking group, noted an uptick in biopharma equity capital markets activity after Labor Day in 2024, according to Fierce Biotech. “We’re expecting more of that through 2025. With strong balance sheets and a continued desire for growth assets, we expect to see M&A continue to pick up in activity and to pick up in size,” Meilman said.
A clear indication of improved interest in dealmaking was the record-breaking activity on BIO’s partnering platform at JPM Week. The platform allows participants to enter their profile and describe what they’re looking for, and then lets them automate partnering and schedule meetings.
This year more than 2,400 registered in the system, holding 6,900+ meetings, a record for BIO’s platform at JPM Week, according to Mackensie Vernetti, BIO’s VP of Partnering.
Fallon said the busy partnering on BIO’s platform bodes well for the CEO Investor Conference.
“BIO’s experience is that the momentum from a busy JPM Week continues and carries into the BIO CEO & Investor Conference. That’s where companies are able to continue the conversation that they started at JPM Week or meet a potential new partner to advance their 2025 goals,” he said.
Mackensie agreed that conversations continue throughout the year at biotech gatherings, like June’s BIO International Convention, the largest annual gathering of the biotechnology industry, and February’s BIO CEO & Investor Conference.
“It’s important to have multiple touch points throughout the year so you can be cultivating those relationships all year long. CEO is also a good way to do follow up on connections from JPM Week,” Mackensie said.
Of course, BIO’s partnering system will be available at the BIO CEO and Investor Conference, she added. Find out more here.
