Planegg/Munich, Germany, and Wilmington, Delaware, U.S.

Planegg/Munich, Germany, and Wilmington, Delaware, U.S., January

MorphoSys and Incyte Sign Global Collaboration

and License Agreement for Tafasitamab

- MorphoSys and Incyte to co-commercialize tafasitamab in the U.S.

- Incyte has exclusive commercialization

rights outside of the U.S.

- MorphoSys and Incyte to host joint

conference call on January 13, 2020 at 7:00am PST / 4:00pm CET

MorphoSys AG (FSE: MOR; Prime Standard

Segment; MDAX & TecDAX; NASDAQ: MOR) and Incyte Corporation (NASDAQ: INCY) announced today that the companies have entered

into a collaboration and license agreement to further develop and commercialize MorphoSys' proprietary anti-CD19 antibody

tafasitamab (MOR208) globally. Tafasitamab is an Fc-engineered antibody against CD19 currently in clinical development for the

treatment of B cell malignancies. MorphoSys and Incyte will co-commercialize tafasitamab in the U.S., while Incyte has exclusive

commercialization rights outside of the U.S.

"The global partnership with Incyte

is an important step towards unlocking the full potential of tafasitamab and achieving our goal of rapidly bringing tafasitamab

to patients inside and outside of the U.S.," said Jean-Paul Kress, M.D., Chief Executive Officer of MorphoSys. "The

combination of our strong antibody and drug development expertise partnered with Incyte's well-established hematology-oncology

experience and their commercial operations in key territories has the potential to significantly broaden the tafasitamab opportunity.

We are pleased to work with Incyte to jointly improve the lives of patients suffering from DLBCL and other devastating diseases."

"Bringing together Incyte's

expertise and MorphoSys commitment to innovation will allow us to make tafasitamab widely available to patients with cancer,

upon approval," said Herv Hoppenot, CEO of Incyte. "We look forward to collaborating closely with the team

at MorphoSys and adding tafasitamab to our portfolio of oncology candidates as part of our committment to bringing new, advanced

treatment options to patients and the clinical community around the world."

Under the terms of the agreement, MorphoSys

will receive an upfront payment of $750 million and, in addition, Incyte will make an equity investment into MorphoSys of $150

million in new American Depositary Shares (ADS) of MorphoSys at a premium to the share price at signing of the agreement. Depending

on the achievement of certain developmental, regulatory and commercial milestones, MorphoSys will be eligible to receive milestone

payments amounting to up to $1.1 billion. MorphoSys will also receive tiered royalties on ex-U.S. net sales of tafasitamab in a

mid-teens to mid-twenties percentage range of net sales.

In the U.S., MorphoSys and Incyte will

co-commercialize tafasitamab, with MorphoSys leading the commercialization strategy and booking all revenues from sales of tafasitamab.

Incyte and MorphoSys will be jointly responsible for commercialization activities in the U.S. and will share profits and losses

on a 50:50 basis. Outside the U.S., Incyte will have exclusive commercialization rights, and will lead the commercialization strategy

and book all revenues from sales of tafasitamab, paying MorphoSys royalties on ex-U.S. net sales.

Furthermore, the companies will share development

costs associated with global and U.S.-specific trials at a rate of 55% (Incyte) to 45% (MorphoSys); Incyte will cover 100% of the

future development costs for trials that are specific to ex-U.S. countries.

Both parties have agreed to co-develop

tafasitamab broadly in relapsed/refractory diffuse large B cell lymphoma (r/r DLBCL), frontline DLBCL as well as additional indications

beyond DLBCL, such as follicular lymphoma (FL), marginal zone lymphoma (MZL) and chronic lymphocytic leukemia (CLL). Incyte will

be responsible for initiating a combination study of its investigational PI3K-delta inhibitor parsaclisib and tafasitamab in r/r

B cell malignancies. Further, Incyte will be responsible for leading any potential registration-enabling studies in CLL and a phase

3 trial in r/r FL/MZL. MorphoSys will continue to be responsible for its currently ongoing clinical trials of tafasitamab in non-Hodgkin

lymphoma (NHL), CLL, r/r DLBCL and frontline DLBCL. The parties will share responsibility in starting additional global trials,

and Incyte intends to pursue development in additional territories including Japan and China.

MorphoSys recently submitted a Biologics

License Application (BLA) for tafasitamab, in combination with lenalidomide, to the U.S. Food and Drug Administration (FDA) for

the treatment of r/r DLBCL; the FDA decision regarding a potential approval is expected by mid-2020. The submission of a Marketing

Authorization Application (MAA) to the European Medicines Agency (EMA) in r/r DLBCL is planned for mid-2020.

The agreement between MorphoSys and Incyte,

including the equity investment, is subject to clearance by the U.S. antitrust authorities under the Hart-Scott-Rodino Act as well

as by the German and Austrian antitrust authorities, and will become effective as soon as these conditions have been met.

MorphoSys and Incyte will host a joint

conference call on January 13, 2020 at 7:00am PST/ 4:00pm CET.

Dial-in numbers for the conference call

on Monday, January 13, 2020 at 7:00am PST; 3:00pm GMT; 10:00am EST; 04:00pm CET:

For Germany: +49 69 201 744 220

For the U.K.: +44 203 009 2470

For the U.S.: +1 877 423 0830

Participant PIN: 55656540#

Please dial in 10 minutes before the beginning

A live webcast will be made available

at www.morphosys.com and at investor.incyte.com.

Tafasitamab is an investigational humanized

Fc-engineered monoclonal antibody directed against CD19. In 2010, MorphoSys licensed exclusive worldwide rights to develop and

commercialize tafasitamab from Xencor, Inc. Tafasitamab incorporates an XmAb engineered Fc domain, which is intended

to lead to a significant potentiation of antibody-dependent cell-mediated cytotoxicity (ADCC) and antibody-dependent cellular phagocytosis

(ADCP), thus aiming to improve a key mechanism of tumor cell killing. MorphoSys is clinically investigating tafasitamab as a therapeutic

option in B cell malignancies in a number of ongoing combination trials. An open-label phase 2 combination trial (L-MIND study)

is investigating the safety and efficacy of tafasitamab in combination with lenalidomide in patients with relapsed/refractory DLBCL

who are not eligible for high-dose chemotherapy (HDC) and autologous stem cell transplantation (ASCT). Based on interim data from

L-MIND, in October 2017 the U.S. FDA granted Breakthrough Therapy Designation for tafasitamab plus lenalidomide in this patient

population. Re-MIND, the real-world data lenalidomide alone matched control cohort met its primary endpoint in October 2019, demonstrating

clinical superiority of the tafasitamab/lenalidomide combination compared to lenalidomide alone. The ongoing phase 3 study B-MIND

assesses the combination of tafasitamab and bendamustine versus rituximab and bendamustine in r/r DLBCL. In addition, tafasitamab

is currently being investigated in patients with relapsed/refractory CLL/SLL after discontinuation of a prior Bruton tyrosine kinase

(BTK) inhibitor therapy (e.g. ibrutinib) in combination with idelalisib or venetoclax.

MorphoSys (FSE & NASDAQ: MOR) is a

clinical-stage biopharmaceutical company dedicated to the discovery, development and commercialization of exceptional, innovative

therapies for patients suffering from serious diseases. The focus is on cancer. Based on its leading expertise in antibody, protein

and peptide technologies, MorphoSys, together with its partners, has developed and contributed to the development of more than

100 product candidates, of which 28 are currently in clinical development. In 2017, Tremfya , marketed by Janssen

for the treatment of plaque psoriasis, became the first drug based on MorphoSys's antibody technology to receive regulatory

approval. The Company's most advanced proprietary product candidate, tafasitamab (MOR208), has been granted U.S. FDA breakthrough

therapy designation for the treatment of patients with relapsed/refractory diffuse large B-cell lymphoma (DLBCL). Headquartered

near Munich, Germany, the MorphoSys group, including the fully owned U.S. subsidiary MorphoSys US Inc., has approximately 405

employees. More information at https://www.morphosys.com.

HuCAL , HuCAL GOLD ,

HuCAL PLATINUM , CysDisplay , RapMAT , arYla , Ylanthia ,

100 billion high potentials , Slonomics , Lanthio Pharma , LanthioPep

and ENFORCERTM are trademarks of the MorphoSys Group. Tremfya is a trademark of Janssen Biotech, Inc.

XmAb is a trademark of Xencor, Inc.

Parsaclisib (INCB50465) is a highly selective

and potent inhibitor of the phosphatidylinositol 3-kinase delta (PI3K ) isoform. PI3K is an important target implicated

in malignant B-cell growth, survival and proliferation, and its inhibition has potential as a mechanism to treat hematologic malignancies

and a variety of B-cell mediated and antibody-driven diseases beyond oncology. The CITADEL (Clinical Investigation of TArgeted

PI3K-DELta Inhibition in Lymphomas) clinical trial program is currently evaluating parsaclisib in several ongoing Phase 2 trials

as a treatment for non-Hodgkin lymphomas (follicular, marginal zone and mantle cell). Parsaclisib is also being studied for patients