Lilly taps obesity windfall for more M&A. Plus, Elon Musk remarks pull GE Vernova lower

AI data centers face power shortages, with Anthropic estimating future models may need gigawatts of electricity. GE Vernova (GEV) is benefiting from surging demand for its gas turbines, with orders jumping fourfold in Q2. The company's backlog reached $176 billion, and it's involved in projects like Texas's Project Kilby for Microsoft's AI data center.

Anthropic highlights electricity as a major constraint for AI data centers, with the U.S. AI sector potentially requiring 50 GW by 2028. GE Vernova (GEV) is positioned to benefit, offering power solutions like gas turbines. GEV's orders surged in Q2, with a $176B backlog. It's involved in Project Kilby, a power facility for Microsoft's AI data center.

Eli Lilly (LLY) announced a $2.88 billion all-cash acquisition of Merida Biosciences to expand its drug pipeline. LLY shares are up 35% since late April, with a forward P/E of 32x. The company reported 48% Q2 revenue growth and raised full-year guidance to at least $85 billion. Wall Street analysts maintain a 'Strong Buy' rating with a mean price target of $1,335.

Lilly's combination therapy of ixekizumab (Taltz) and tirzepatide (Zepbound) showed sustained improvements in psoriatic disease and body weight at 1 year, according to phase 3b trials. The study reported better outcomes in disease activity and metabolic markers compared to ixekizumab monotherapy. The trials enrolled 274 and 271 adults with moderate to severe psoriatic disease and overweight or obesity.

A Fifth Circuit panel ruled that the FDA lawfully removed GLP-1 medications from Eli Lilly & Co. and Novo Nordisk from the national drug shortage list. The case involved disputes over drug shortages and the 340B drug pricing program.

Eli Lilly (LLY) acquires Merida for $2.8B, gaining access to potential therapeutics for autoimmune and allergic diseases. The deal is expected to close in Q4 2026. Lilly has made several recent acquisitions, including Kelonia, Orna, Ajax, and Ventyx. Separately, Chobani announces a new dairy facility in Upper Macungie Township, PA, near Lilly's planned $3.5B campus.