Merck & Co Inc (NYSE:MRK) is set to acquire Prometheus Biosciences for $10.8bn in an all-cash deal, as the US drugmaker aims to bolster its pipeline.
San Diego-based Prometheus focuses on diseases caused by abnormal immune system activity and is working on a monoclonal antibody treatment for ulcerative colitis, an inflammatory bowel disease. The acquisition will bolster Merck's position in the rapidly growing immunology field.
Merck chief executive Robert Davis stated that the transaction would add diversity to the company's portfolio and contribute to growth well into the next decade.
The deal, valued at a 75% premium to Prometheus' closing share price on Friday, is expected to close in the third quarter, subject to shareholder and regulatory approvals.
Merck has a pressing need to augment the new drugs coming through its development pipeline with its top-selling drug Keytruda, a treatment for cancer that generated revenues of US$21bn last year, potentially under threat from cheap competition by the end of 2020s.