Inorganic growth strategy

In 2019, Merck & Co. (MRK) has been focused on bolstering its Oncology and Vaccine portfolios through acquisitions in an attempt to reduce overreliance on Keytruda.

Acquisition of Immune Design

On April 2, Merck & Co. issued a press release announcing the successful completion of its cash tender offer for Immune Design, with 86.75% of the target’s total outstanding common stock tendered on a fully diluted basis. On February 21, the company announced its acquisition of Immune Design for a total cash consideration of $300 million, or $5.85 per share. This deal has added in vivo technologies ZVex and GLAAS, which are expected to strengthen Merck’s capabilities for developing vaccines targeting infectious diseases and various types of cancer.

Acquisition of Viralytics

On February 21, Merck issued a press release announcing its proposal to acquire Australian oncolytic immunotherapy player Viralytics for a total consideration of 502 million Australian dollars ($394 million). The deal is expected to add investigational oncolytic immunotherapy CAVATAK to Merck’s portfolio both as a monotherapy and in combination with Keytruda in early and mid-stage trials across multiple tumor types.

Acquisition of Peloton Therapeutics

On May 21, Merck issued a press release announcing the definitive agreement it had entered for the acquisition of private, clinical-stage biopharmaceutical company Peloton Therapeutics for an up-front cash payment of $1.05 billion and an additional contingent payment of $1.15 billion. This deal is expected to add multiple investigational small-molecule therapies targeting HIF-2α (hypoxia-inducible factor-2α), including the late-stage HIF-2α inhibitor PT2977 targeting renal cell carcinoma. The deal is expected to close in the third quarter of 2019.

Acquisition of Tilos Therapeutics

On June 10, Merck issued a press release announcing a definitive agreement for the acquisition of private biopharmaceutical company Tilos Therapeutics. This deal, priced at ~$773 million, will provide Merck with access to investigational anti-latency-associated peptide antibodies targeting latent transforming growth factor-beta complex, which could prove to be a treatment option in oncology, autoimmune, and fibrosis indications.

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