Four months, six M&A transactions, with total deal value exceeding US$21 billion at the upper limit – since the beginning of the year, Eli Lilly has been on a "crazy shopping spree," with transaction volumes already rivaling its total acquisition spending over the past three years, and surpassing its total acquisition scale for any single year since 2010.

Leveraging its differentiated positioning in the metabolic space, in 2025 Eli Lilly overtook Novo Nordisk's first-mover advantage. Its flagship product, tirzepatide, raked in US36.507billion,seizingthecrownof"blockbusterking."Inthesecondarymarket,LillyalsobecamethefirstpharmaceuticalcompanytoreachamarketcapitalizationofUS36.507billion,seizingthecrownof"blockbusterking."Inthesecondarymarket,LillyalsobecamethefirstpharmaceuticalcompanytoreachamarketcapitalizationofUS1 trillion.

In 2026, armed with the "cash cow" of its weight-loss drugs, Lilly began a "thousand gold for a horse bone" strategy, using a series of smaller acquisitions to expand its growth potential in cutting-edge innovation fields.

"Currently, Lilly is perceived as a weight-loss drug company, which is certainly a very important part of our business," said Jacob Van Naarden, President of Lilly Oncology and Head of Corporate Business Development. "But over time, our goal is to intentionally leverage the financial strength provided by our weight-loss business growth to diversify our operations and enter other therapeutic areas."

Van Naarden also indicated that Lilly has slightly adjusted its acquisition strategy. By conducting a significant number of early-stage and late-stage transactions simultaneously, the company can better balance risk and return.

He noted that the challenge with early-stage deals is that many may "fizzle out." While investing in later-stage deals may appear more expensive upfront, they can still create value over the long term, and the assets in these later-stage deals have greater certainty, offering "de-risked" value.

It may seem like reckless spending, but each move is strategically calculated.

While competitors are still figuring out how to replicate its GLP-1 dominance, Lilly has already pushed open multiple doors leading to the future.

TONACEA 01: What Did US$21 Billion Buy?

Outsiders look at the ledger; insiders look at the strategic positioning behind the numbers.

In January, Lilly acquired Ventyx for US$1.2 billion. Ventyx holds a key target for tackling chronic diseases – the NLRP3 inflammasome. VTX3232, an oral inhibitor capable of penetrating the central nervous system, reduced high-sensitivity C-reactive protein (hs-CRP) by approximately 80% in its Phase II study, an effect lasting a full 12 weeks.

As the pathological consensus of obesity as "a systemic low-grade chronic inflammatory state" takes shape, Lilly is breaking down the disciplinary barriers between metabolism and immunity. Through this acquisition, Lilly is building an invincible closed loop: "GLP-1-driven weight loss + NLRP3-driven resolution of cardiovascular inflammation."

Soon, inflammatory pathways were no longer the sole narrative. Many patients suffering from obesity also grapple with another hidden torment: insomnia, sleepiness, and the persistent erosion of mood and sleep drive.

Lilly then turned around and acquired Centessa for up to US$7.8 billion. Centessa is a company specifically targeting the master switch of sleep. Its core mechanism is an OX2R agonist – a molecular switch that precisely activates the brain's orexin receptor – aiming to provide a fundamental solution for narcolepsy and idiopathic hypersomnia.

In Lilly's hands, it's not hard to imagine this logic resonating with its GLP-1 metabolic user base – moving from body weight all the way to sleep, inflammation, and multi-dimensional health improvements.

Even more compelling chapters unfolded in February and April.

First, Lilly acquired Orna for US2.4billion,securingatechnologypackageforLNPs(lipidnanoparticles)deliveringcircularRNA.Lessthantwomonthslater,LillyacquiredKeloniaforaUS2.4billion,securingatechnologypackageforLNPs(lipidnanoparticles)deliveringcircularRNA.Lessthantwomonthslater,LillyacquiredKeloniaforaUS3.25 billion upfront payment (up to US$7 billion), this time obtaining a patent portfolio for engineered lentiviral vector-based in vivo gene editing delivery.

AstraZeneca bet on lentivirus (EsoBiotec), AbbVie on LNPs (Capstan), and Gilead and Bristol-Myers Squibb also made significant wagers – nearly all top players in the industry have chosen sides.

But Lilly's strategic thinking is clearer than any other MNC: instead of choosing one route, it is securing both. This way, regardless of which direction produces a winner, Lilly will have a seat at the table – the most conservative hedge against uncertainty.

This logic extends to its other acquisitions as well.

In April, Lilly acquired CrossBridge – a modest deal with a US$300 million ceiling, but one that secured a dual-payload ADC platform. Its core asset, CBB-120, carries both a TOP1 inhibitor and an ATR inhibitor, blocking cancer cells through two pathways simultaneously, avoiding the predicament of cancer recurrence after a single pathway fails in traditional ADCs.

A few weeks later, Lilly completed the acquisition of Ajax for up to US$2.3 billion, obtaining a candidate drug, AJ1-11095 – a first-in-class molecule targeting a "Type II JAK2 conformation."

When existing Type I JAK2 inhibitors like ruxolitinib reach the end of the road due to intractable resistance, this new mechanism not only opens a new therapeutic window but also, to some extent, raises the "ceiling" for clinical treatment of tumor resistance.

Overall, Lilly's current business development logic has shifted decisively from the traditional "pipeline supplementation" mindset of existing assets to an incremental strategy of "acquiring next-generation disruptive foundational technologies."

These transactions are highly concentrated in three core strategic dimensions: first, the deep integration of cross-disciplinary mechanisms; second, revolutions in foundational delivery and gene-editing technologies; and third, tackling pain points of resistance that current standard-of-care therapies cannot solve.

TONACEA 02: Lilly's M&A Logic

In fact, if you look at MNCs during this period, Lilly is not unique in its "crazy shopping spree."

The entire industry stands at a common crossroads. According to Evaluate Pharma, between 2023 and 2028, the total risk exposure from patent expirations of originator drugs, measured by product sales, will reach US$354 billion, accounting for 32% of the total global pharmaceutical market size in 2022.

In the medium term, Guosen Securities points out that at least five products with >US10billioninsales(Darzalex,Stelara,Semaglutide,Keytruda,Eliquis)andfiveproductswith>US10billioninsales(Darzalex,Stelara,Semaglutide,Keytruda,Eliquis)andfiveproductswith>US5 billion in sales (Trulicity, Entresto, Farxiga, Opdivo, Revlimid) will face patent expirations by 2030, with most MNCs facing risk exposures above 30%.

This means that if multiple products lose patent protection within a concentrated 3-5 year window, MNCs will find it difficult to bridge the revenue gap solely through internal pipeline lifecycle management. To make matters worse, the R&D return on investment (ROI) for innovative drugs has been declining for nearly two decades, further compounding the difficulty of covering revenue gaps with internal pipelines.

When internal innovation is insufficient to cover revenue shortfalls, M&A becomes a more cost-effective option – using real money to buy back pipeline assets and bridge the gap before the patent cliff arrives.

Lilly faces a patent cliff as well, but not an imminent one.

Its core products do not face a "cliff-like" patent expiration, such as Pfizer's Lipitor or Lyrica. Verzenio (CDK4/6i, breast cancer) and Taltz (IL-17A, psoriasis) have patent protection extending until around 2030, while Jardiance (diabetes/heart failure) faces challenges between 2025 and 2028.

The reason Lilly can expand so confidently is not because it has no other options, but because it holds a unique ballast that no other company can replicate: cash flow.

In 2025, tirzepatide topped global sales at US36.507billion.Lilly′stotalannualrevenuereachedUS36.507billion.Lilly′stotalannualrevenuereachedUS65.179 billion, a year-on-year increase of 44.7%, with net profit soaring 94.9%.

Its latest first-quarter report shows: in Q1 2026, total revenue was US19.799billion,up5619.799billion,up567.396 billion, a staggering 168% increase. Of this, the diabetes version Mounjaro generated US8.662billioninQ1revenue,up1258.662billioninQ1revenue,up1254.160 billion, up 80% year-on-year. Together, the two products contributed US$12.822 billion, accounting for 65% of total revenue.

The total US$21 billion in acquisition deals is less than a single year's sales of tirzepatide, not to mention the multiple revenue reservoirs built by Lilly's broader product portfolio.

This is not a gamble that cash flow cannot support, but a proactive deployment without any funding pressure – there is so much money that it must be spent, and the cost of making a small mistake in capital allocation is far less than the cost of doing nothing.

Moreover, extending the timeline slightly reveals that Lilly has actually been quite active in BD and M&A markets over the past two years.

According to the NextPharma database from PharmaCube, from 2025 to present, Lilly ranks first among MNCs in BD deals as a licensee, with 30 transactions, primarily focusing on preclinical assets or technology collaborations in cardiometabolic, oncology, and autoimmune diseases.

Simultaneously, Lilly prefers to use M&A to expand growth potential in cutting-edge innovative fields. Since 2025, it has completed 13 M&A transactions, with an average size of approximately US$2 billion.

Overall, Lilly's M&A logic favors precision acquisitions at modest sizes, with no single deal exceeding US$8 billion. Instead of placing a concentrated bet on a single transformative asset, Lilly uses a diversified portfolio of technological bets to exchange margin of error and time for potential high-growth opportunities that may emerge in the future.

TONACEA 03: The BIC Philosophy of a Latecomer

In the broader business world, Lilly is also a compelling case study for careful analysis.

This 150-year-old company, in its innovative drug R&D, rarely takes high risks to develop FIC targets. Instead, it tends to wait for targets to be relatively validated and then rapidly follow up to develop "me-better" drugs.

The GLP-1 race, the CDK4/6 field, BTK, and Alzheimer's disease – all are such examples. In nearly every major therapeutic area, Lilly was not the first mover, yet it has repeatedly overtaken the competition in the second half of the race, even reaching the top.

Take the "blockbuster king" battle in GLP-1. Novo Nordisk had already carved out the entire weight-loss market with semaglutide when Lilly entered with tirzepatide (the first GLP-1/GIP dual agonist). With its "me-better" efficacy, Lilly caught up and reversed the competitive landscape in just two years.

The seven acquisitions this year also reflect this pattern. In 2025, in vivo CAR-T exploded, with AstraZeneca, AbbVie, Gilead, BMS, and others all making moves, effectively buying up the entire first tier of innovative companies in the field. Lilly chose to hold back until February of this year to make its first acquisition in the in vivo CAR-T space.

The timing of its moves is also telling: whereas bold players like AstraZeneca might spend US$1 billion based on just four IIT data points, Lilly waited for Phase I clinical data and products ready for clinical filing. Moreover, while other MNCs chose a single technological route, Lilly placed simultaneous bets on both.

The core of this playbook can be summarized as "time-lag arbitrage": do not rush to be the first to cross the finish line. Instead, wait for the first runner to clarify the risks and rules of the race, then surpass the leader with a superior product. This strategy significantly reduces R&D uncertainty – FIC products typically bear the greatest risk of clinical failure and the highest market education costs, whereas fast followers can "stand on the shoulders of giants."

This fast-follower strategy may appear "conservative," but it is actually a form of high strategic discipline: after a target is preliminarily validated and risks are substantially reduced, enter the battlefield with greater speed and a better molecule, achieving a "me-better" or even "best-in-class" comeback.

The business value of FIC versus BIC has been widely debated. What Lilly offers is a rare form of "organizational endurance" – the ability to wait for a field to mature, then surpass the competition with a superior product and stronger commercial capabilities.

In an innovative drug industry that occasionally gets overly excited about the "global first" label, Lilly's seemingly subtle strategic resolve is sometimes underestimated and sometimes ridiculed as conservative. But history has repeatedly proven that drug development is not a sprint; it is a cross-country race – what matters most is not a beautiful start, but endurance along the way and the ability to sprint at the finish.

Final Thoughts

Returning to the opening question: with its intensive six acquisitions in four months, what exactly is Lilly racing for?

The answer may not lie in the drug targets or pipelines of these six transactions, but in the fact that Lilly is conducting a future-oriented experiment for the global pharmaceutical industry on "how to spend money":

In an era of industry involution, target homogenization, and restless capital, convert the certain returns from GLP-1 into a highly diversified investment portfolio in cutting-edge science. At every critical juncture of divergent paths, "buy all the possible answers," then patiently await the judgment of time – and the potential to create BICs.

References:

Eli Lilly to acquire Kelonia Therapeutics in deal worth up to $7 billion

Eli Lilly outlays $2.3bn to acquire blood cancer specialist Ajax Therapeutics

Gazelle News, "Pharma Giant, Crazy Bone Buying"

Sohu Health, "Eli Lilly's 'Eating' Logic"

PharmaCube, "2026 Will Be a Big Year for Innovative Drug BD"