In a move that will enable Merck to increase its efforts in autoimmune diseases, the company announced Sunday that is will spend $10.8 billion to acquire California-based Prometheus Biosciences, a leader with a promising experimental treatment for ulcerative colitis and Crohn’s disease.
Merck, based in Rahway, will pay $200 per share for Prometheus — an incredible 75% premium to its $114 closing price last Friday. The transaction, subject to numerous approvals, is expected to close in the third quarter.
Merck Chair and CEO Robert Davis said the company is worth the price.
“At Merck, we are committed to delivering on our purpose to save and improve lives and continue to identify and secure opportunities where compelling science and value creation align,” he said.
“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.”
Prometheus is a clinical-stage biotechnology company pioneering a precision medicine approach for the discovery, development and commercialization of novel therapeutic and companion diagnostic products for the treatment of immune-mediated diseases.
Prometheus is developing PRA023 for the treatment of immune-mediated diseases, including ulcerative colitis, Crohn’s disease and other autoimmune conditions.
Last December, the company announced positive results for PRA023 from ARTEMIS-UC, a Phase 2, placebo-controlled study evaluating safety and efficacy in patients with moderate to severely active UC, and APOLLO-CD, a Phase 2A, open-label study evaluating safety and efficacy in patients with moderate to severe CD.
Dean Li, president, Merck Research Laboratories, said his team is eager to work with Prometheus.
“By applying a portfolio of powerful analytic tools to a comprehensive collection of IBD samples, Prometheus identified important disease insights that have now yielded a promising late-stage candidate,” he said. “I look forward to working with the talented Prometheus team to establish a new paradigm of precision treatment for immune diseases.”
Prometheus Chair and CEO Mark McKenna said the company is eager to work with Merck.
“Prometheus was established to revolutionize the treatment of immune-mediated diseases through the application of a powerful precision medicine approach,” he said. “This agreement with Merck, a leader in biopharmaceutical research and development, 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.”
