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Merck will acquire Prometheus Biosciences, a clinical-stage biotechnology company specializing in immune-mediated diseases, at a total equity valuation of $10.8 billion.
Merck and Prometheus Biosciences, a clinical-stage biotechnology company specializing in immune-mediated diseases, announced an acquisition agreement on April 16, 2023. Merck will acquire all outstanding shares of the company for $200 per share, a total approximate equity valuation of approximately $10.8 billion. This equity valuation makes this pharma acquisition the second largest of the year, following Pfizer’s $43 billion acquisition of Seagen in March. The transaction is expected to close in the third quarter of 2023.
According to a company press release, Prometheus Biosciences’ lead candidate is PRA023, a humanized monoclonal antibody (mAb) directed to tumor necrosis factor (TNF)-like ligand 1A (TL1A), which is associated with both intestinal inflammation and fibrosis. It is currently being developed for treatment of immune-mediated diseases including ulcerative colitis, Crohn’s disease (CD), and other autoimmune conditions. Positive results from an open-label Phase IIA study (APOLLO-CD) evaluating its safety and efficacy in patients with CD were published in December 2022.
“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,” said Robert M. Davis, chairman and CEO, Merck, in the release.
“Prometheus was established to revolutionize the treatment of immune-mediated diseases through the application of a powerful precision medicine approach,” said Mark McKenna, chairman and CEO, Prometheus Biosciences, in the release. “This agreement with Merck … allows Prometheus to maximize 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.”