Merck's $10.8 Billion Bet on Gut Health Just Passed Its Biggest Test

The treatment options have expanded over the past decade: anti-TNF antibodies, JAK inhibitors, anti-integrins, IL-23 blockers. But the numbers tell a frustrating story. About 30 to 50% of patients don't respond adequately to any given therapy. Among those who do respond, roughly 15% per year lose that response. By year three, nearly half need to switch drugs.

Only 24% of UC patients in one stakeholder survey said their current medications were adequate. That's a staggering gap between what's available and what patients actually need.

Tulisokibart represents something genuinely new: a different biological pathway, a different mechanism, and (if the full data confirm it) potentially a different outcome for patients who've run out of options.

The Race Merck Is Winning, For Now

Merck isn't alone in targeting TL1A. This is shaping up to be one of the hottest races in gastroenterology:

• Roche has afimkibart (originally from Roivant) in two Phase 3 UC trials, with strong Phase 2b data showing sustained remission out to week 56.
• Teva and Sanofi are developing duvakitug, which posted a remarkable ~48% remission rate in Phase 2b. They're positioning it as "best-in-class" and plan to start Phase 3 in the second half of 2026.

But tulisokibart just became the first in the class to clear Phase 3. That's a meaningful head start.

Not everyone is fully convinced, though. Citi analyst Geoff Meacham notes that Merck hasn't released detailed numbers yet (remission rates, dose response, placebo comparisons). Without those, he says it's hard to judge how tulisokibart stacks up against existing IL-23 blockers and JAK inhibitors. The competitive read-through, as he puts it, is limited.

The Keytruda Clock Is Ticking

Zoom out and the strategic picture becomes clear. Keytruda, Merck's cancer immunotherapy juggernaut, faces a patent cliff around 2028. The company needs new revenue engines, and it needs them soon.

Merck's leadership has been explicit about the plan: diversify into cardiovascular (oral PCSK9 inhibitor MK-0616), pulmonary hypertension (Winrevair), and immunology (tulisokibart). The company even restructured in 2026, splitting its pharma business into an oncology unit and a specialty unit to give non-cancer drugs more commercial attention.

Tulisokibart isn't just an IBD drug in this context. It's one of Merck's top three post-Keytruda bets. And the ambitions extend beyond the gut: a Phase 2 trial called ATHENA is testing tulisokibart in systemic sclerosis-associated lung disease, with studies planned across six immune-mediated conditions total.

What Comes Next

Merck says the full ATLAS-UC data (both the induction-only Study 2 that just read out, and the ongoing induction-plus-maintenance Study 1) will be presented at an upcoming medical conference and shared with regulators.

The maintenance data will be critical. Showing that patients stay in remission long-term is what separates a good IBD drug from a great one. It's also what the FDA will want to see before granting approval.

If everything holds, the timeline looks like this: full data presentation later in 2026, regulatory submission by late 2026 or early 2027, and potential approval and launch in 2027.

For the 1.25 million Americans living with ulcerative colitis (and the millions more worldwide), a genuinely new mechanism of action reaching the market would be the most significant advance in years. For Merck, it would be validation that $10.8 billion can buy more than a pipeline asset. It can buy a future.

Exelixis Built a Backup Plan for Its $2B Drug. It Just Hit a Wall.

Exelixis' next-generation drug zanzalintinib missed a key survival endpoint in colorectal cancer, sending shares down 10-12%. With Cabometyx still driving 90% of revenue, the pressure to prove the successor can carry the franchise just got a lot more intense.