InnovationRx: M&A Activity, Sleep Apnea Pill, Pomelo Care’s Expansion, and More
TL/DR –
The 44th annual J.P. Morgan Healthcare Conference highlighted the growing trend of mergers and acquisitions in the healthcare industry, with biopharma M&A activity reaching $116 billion in 2025, more than double the $52 billion in 2024. Additionally, Apnimed, a Cambridge-based startup, is preparing to file for FDA approval for a daily pill for sleep apnea, a condition that affects an estimated 80 million people in the U.S. Lastly, venture firm Stripes led a $92 million funding round for Pomelo Care, a virtual care provider founded by former Flatiron Health exec Marta Bralic Kerns, raising the startup’s valuation to $1.7 billion.
InnovationRx: Upcoming M&A Activity, Sleep Apnea Pill, and More
As the healthcare industry begins their annual J.P. Morgan Healthcare Conference, M&A activity is expected to grow. The San Francisco event is known as a hotbed for dealmaking activity, with Lilly agreeing to acquire Ventyx, a company working on a drug for recurrent pericarditis, for $1.2 billion. Meanwhile, Merck is in talks to purchase cancer drug developer Revolution Medicines for up to $32 billion.
Biopharma M&A activity reached $116 billion in 2025, a significant increase from $52 billion in 2024. This year, Big Pharma is looking to counter the upcoming patent cliff for blockbuster drugs, while also competing for a share of the obesity drug market, expected to reach $100 billion in sales.
‘Holy Grail’ Sleep Apnea Pill Expected Next Year
Apnimed, a Cambridge-based startup, is set to file for FDA approval for a nightly pill to treat sleep apnea. The drug, a combination of two existing medications, works by activating the brain stem while allowing the brain itself to rest during sleep. If approved, it could provide a life-changing treatment for the estimated 80 million people in the U.S. with sleep apnea. More details here.
$1.7 Billion Startup Expanding Virtual Care From Moms To All Women
Pomelo Care, founded by Marta Bralic Kerns, raised $92 million to expand its virtual care model to women at all stages of their lives. The startup currently supports nearly 7% of all U.S. births and plans to extend its services to postmenopausal women and children. Read more here.
Nvidia and Eli Lilly Announce $1 Billion AI Venture
Nvidia and Eli Lilly have announced a $1 billion investment in an innovation lab. The venture will focus on developing AI models to accelerate the development of new medicines.
What We’re Reading
A Senate report found that UnitedHealth Group used aggressive strategies to boost payments from the Medicare Advantage program. In New York City, around 15,000 nurses went on strike over healthcare benefits, safety protections, and staffing standards. The five-year survival rate across cancer reached 70%, up from 50% in 1971, according to an American Cancer Society report. GSK’s drug candidate bepirovirsen showed positive results against hepatitis B in clinical trials, potentially ending the need for daily medication in some patients. Veradermics, a biotech startup led by Forbes 30 Under 30 alum Reid Waldman and developing a hair regrowth drug, filed for an IPO to raise up to $100 million.
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