Eli Lilly’s $856M Wager: Buy or Beware?

Success is like a buffet-once you’ve had your fill, you start eyeing the dessert cart. For Eli Lilly, that means throwing money at problems that weren’t *actually* problems until they were. Take their $856 million deal with Gate Biosciences. It’s not just about drugs; it’s about proving to the boardroom that they’re *still* relevant, even as their old patents expire. Classic corporate overcorrection. You fix one leak, and suddenly you’re buying a damn umbrella factory.

Gate’s “Molecular Gates” sound like a sci-fi concept, but let’s be real: it’s just another way to target proteins that no one else could be bothered to touch. The idea is simple-why stop at easy targets when you can complicate your life? It’s like ordering a salad but then asking for extra ranch, pretzels, and a side of existential dread. Lilly’s paying for the ranch, the pretzels, and the dread. All in one bite.

Planning for the Inevitable (Or So They Think)

Gate Biosciences is a 2021 startup. That’s not a red flag; it’s a neon sign that reads “Here be dragons.” Yet Lilly, ever the optimist, is throwing cash at it like it’s a Kickstarter for a $10 “revolutionary” coffee mug. The biotech’s approach? “Difficult-to-drug proteins.” Oh, how poetic. They’re not just hard to treat-they’re rude, uncooperative, and probably have a poor Yelp rating. And now Lilly’s investing in a solution that might take decades to materialize. If this were a movie, it’d be a Netflix original with a runtime longer than a TikTok algorithm’s attention span.

Meanwhile, Lilly’s core business is doing just fine. Mounjaro and Zepbound are selling like hotcakes. But management? They’re too busy buying startups to enjoy the feast. July’s Verve Therapeutics deal, May’s SiteOne acquisition, January’s Scorpion Therapeutics grab-it’s like they’re playing Monopoly and decided to buy every property just because someone mentioned “rent.” The stock isn’t a buy because of these stunts; it’s a buy because they’re dominating diabetes and obesity markets while pretending to care about Alzheimer’s and oncology. That’s the real hustle.

And let’s not forget the dividend. It’s doubled in five years. That’s not just growth-it’s a middle finger to anyone who thought pharma companies couldn’t be both profitable and boring. But no, Lilly has to chase the next big thing. Maybe they’ll invent a pill for social anxiety. I’d buy that in a heartbeat. 🤷‍♂️

2025-08-08 16:22

Planning for the Inevitable (Or So They Think)

Read More