Merck, the pharmaceutical behemoth, is set to acquire Terns Pharmaceuticals in a staggering $6.7 billion deal, signalling a bold move to fortify its oncology pipeline. The acquisition of the US biotech firm, announced Wednesday, will see Merck paying $53 per share in cash.
This marks Merck’s third major acquisition in the last year, a strategic manoeuvre to bolster its product offerings as the patent protection for its blockbuster cancer drug, Keytruda, nears its end in 2028. The acquisition highlights Merck’s proactive approach to maintaining its dominance in the pharmaceutical landscape.
Terns Pharmaceuticals is currently developing TERN-701, an oral therapy designed to combat chronic myeloid leukaemia. Promising data from Phase 1 trials, released last December, revealed a significant molecular response rate of up to 75% at 24 weeks. Crucially, the drug demonstrated a tolerable safety profile, supporting the potential for daily dosing.
Merck CEO Robert Davis emphasised the strategic importance of the acquisition: "This transaction further diversifies and strengthens our position in oncology as we continue to look for opportunities to broaden our portfolio into other therapeutic areas."
The deal represents a substantial premium for Terns shareholders, with Merck offering a 31% increase over the biotech’s average stock price for the preceding 60 days. News of the acquisition sent Merck shares up by 2% to around $119, while Terns’ stock price jumped 5% to approximately $53.
Subject to regulatory approvals, the transaction is anticipated to be finalised in the second quarter of this year. The acquisition underscores the intense competition and strategic manoeuvring within the pharmaceutical industry, as companies vie for innovative therapies and market leadership.
Key Deal Terms
| Metric | Value |
|---|---|
| Acquisition Price | $6.7 billion |
| Price Per Share | $53 |
| Premium Over 60-Day Avg | 31% |
| Expected Close | Second Quarter |
