Merck Enters Into $11.5B Deal to Boost Cardiovascular Pipeline

Merck recently entered into an $11.5 billion pharma acquisition deal with biotechnology company Acceleron Pharma to strengthen its cardiovascular pipeline. 

Acceleron focuses on transforming the growth factor (TGF)-beta superfamily of proteins that play a crucial role in regulating cell growth, differentiation, and repair.

The company’s lead therapeutic candidate, sotatercept, has a novel mechanism of action with the potential to improve short-term and/or long-term clinical outcomes in patients with pulmonary arterial hypertension (PAH), a Merck spokesperson explained. 

PAH is a progressive and life-threatening blood vessel disorder. Sotatercept is currently in Phase 3 trials as an add-on to the current standard of care to treat PAH. 

“Strategic business development is a top priority for Merck as we look to drive sustainable growth and further bolster and balance our pipeline with breakthrough science,” Rob Davis, chief executive officer and president of Merck, said in the announcement. 

“Acceleron’s innovative research has yielded an exciting late-stage candidate that complements and strengthens our growing cardiovascular portfolio and pipeline,” Davis continued. 

Acceleron’s profile also includes Reblozyl, a first-in-class erythroid maturation recombinant fusion protein approved in the US, Europe, Canada, and Australia to treat anemia in certain rare blood disorders. 

Under a global collaboration, Acceleron and Bristol Myers Squibb are developing and commercializing Reblozyl.

The transaction between Merck and Acceleron is expected to close in the fourth quarter of 2021. 

But Avoro Capital, an investor that owns about seven percent of Acceleron, released a statement explaining that the proposed acquisition “drastically undervalues” Acceleron.  

Avoro Capital stated that recent data suggests that sotatercept will be the first disease-modifying agent for patients with PAH.  Therefore, there should be no urgency to sell at a low price since the company’s value will only increase as additional clinical trial data is released. 

“While we believe Merck is a tremendous company and ultimately could be a good partner to maximize the value of sotatercept and the rest of Acceleron’s pipeline for both patients and shareholders, we do not believe a transaction makes sense right now at the current valuation proposed by Merck,” Avoro Capital said.