Multinational pharmaceutical company Merck is set to expand its rare disease drug portfolio through a strategic acquisition. Cambridge, Massachusetts-based Acceleron Pharma will be bought out by Merck for a whopping $11.5 billion of cash and debt funding. Acceleron, which specializes in pharmaceutical drug development for rare disease and blood-related disorder treatment, had a market capitalization of $10.89 billion at its last closing.
Merck’s soon-to-be subsidiary already has a bevvy of much-anticipated drugs in its pipeline. Sotatercept, which treats pulmonary arterial hypertension, is in late-stage clinical trials and its projected peak sales have reached over $2 billion. Also flirting with entry into the ‘$2 billion earner’s club’ is Reblozyl, a drug marketed in partnership with Bristol Myers Squibb that is mainly used as a treatment for anemia in myelodysplastic syndromes. Reblozyl garnered $274 million in sales over 2020 and has since been on an upward trajectory.
This deal is bound to silence skeptics of Merck’s financial growth roadmap. There’s little doubt that augmenting its product line beyond Keytruda with diverse drug offerings will be beneficial for its business. Reportedly, the main niggle worrying the minds of Merck shareholders has been the lack of sales diversification. The acquisition is therefore an unequivocal victory for the company. The $180 per share shelled out by Merck constitutes a reasonable 34% premium on Acceleron’s stock, which traded at $134 mere weeks ago.