Merck – known as MSD outside the US and Canada – has said it will acquire Prometheus Biosciences for around $10.8bn, marking a significant boost to its immunology pipeline.
The deal will grant Merck access to the California-based biotech’s lead candidate, PRA023, being developed for ulcerative colitis, Crohn’s disease, and other autoimmune conditions.
Prometheus announced positive results from a phase 2 study of the candidate in ulcerative colitis late last year, with 26.5% of patients in the PRA023 cohort achieving clinical remission, compared to 1.5% on placebo.
The company also reported positive results from a single-arm study evaluating the antibody in Crohn’s disease at the same time.
Robert Davis, chairman and chief executive officer of Merck, said: “The agreement with Prometheus will accelerate our growing presence in immunology where there remains substantial unmet patient need.
“This transaction adds diversity to our overall portfolio and is an important building block as we strengthen the sustainable innovation engine that will drive our growth well into the next decade.”
Under the terms of the agreement, Merck will pay $200 per share, representing a 75% premium to the $114.01 closing price for Prometheus shares last week. The transaction is expected to close in the third quarter of this year.
Mark McKenna, chairman and chief executive officer of Prometheus, said: “Prometheus was established to revolutionise the treatment of immune-mediated diseases through the application of a powerful precision medicine approach.
“This agreement with Merck, a leader in biopharmaceutical research and development, allows Prometheus to maximise the potential for PRA023, while continuing to apply our technology and expertise to fuel further discoveries to address the needs of patients with immune disorders.”
The announcement comes just over a week since Merck entered into a multi-year research collaboration and licensing agreement with Proxygen to jointly identify molecular glue degraders against multiple undisclosed therapeutic targets.
The company also signed a worldwide licensing deal worth up to $922.5m last month with Opko Health’s ModeX Therapeutics unit for its experimental Epstein-Barr virus vaccine. The partnership will see both companies advance MDX-2201 to an Investigational New Drug application filing, after which Merck will be responsible for clinical and regulatory activities, as well as product commercialisation.