Merck & Co. Announces It Will Acquire Peloton Therapeutics

12:56 05/25/2019

Merck & Co Inc. MRK  has announced this week that it will be buying Peloton Therapeutics in a transaction valued at $1.05 billion.

With the transaction, the drugmaker will be gaining access to Peloton's lead kidney cancer drug candidate dubbed 'PT2977.'

Peloton expects to start studying 'PT2977' in a late-stage trial in the second half of this year.

'This is a classic bolt-on deal. Peloton has a drug that looks promising in renal cell carcinoma, and there's actually been a lot of success in the field in recent years,' remarked Brad Loncar, who runs the Loncar Cancer Immunotherapy ETF.

In a previous mid-stage trial that tested patients whose cancer had spread even after treatment with at least one therapy, it was revealed that 24% of patients treated with Peloton's drug showed an at least 30% shrinkage of targeted lesions.

'The deal announced today should also underscore the opportunity for other small and mid cap biotech names in the cancer biology space,' commented Cantor Fitzgerald analyst Louise Chen.

“This acquisition exemplifies Merck’s strategy to pursue novel therapeutic candidates based on exceptionally promising and innovative research,” said Dr. Roger M. Perlmutter, president, Merck Research Laboratories.

“Peloton scientists have applied their unique expertise in HIF-2α biology to develop PT2977, which has already shown intriguing activity in the treatment of renal cell carcinoma. We look forward to advancing this late-stage asset as part of our broad oncology R&D program.”

According to Merck & Co.'s press release, 'under terms of the agreement, Merck, through a subsidiary, will acquire all outstanding shares of Peloton in exchange for an upfront payment of $1.05 billion in cash. In addition, Peloton shareholders will be eligible to receive a further $1.15 billion contingent upon successful achievement of future regulatory and sales milestones for certain candidates.'


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