Merck & Co. (MRK) - Get Report said Monday that it will pay $425 million for OncoImmune, a privately held biotech that has developed a promising treatment for patients suffering a severe form of COVID-19.
Rockville, Maryland-based Oncolmmune published late-stage data from a phase 3 trial evaluating its lead therapeutic candidate, CD24Fc, in September that showed a 60% higher probability of improvement for patients suffering severe or critical COVID-19 when compared to placebo. The risk of death or respiratory failure was also reduced by more than 50%, Oncolmmune data indicated.
Oncolmmune will spin-out the rights and assets related to CD24Fc into a separate entity, the companies said, with Merck investing a further $50 million to become a minority shareholder.
“Meaningful new therapeutic options are desperately needed for possibly millions of people around the world who will develop severe or critical COVID-19 disease,” said Merck Research Laboratories president Roger Perlmutter. “Recent clinical investigations support the view that CD24Fc may provide benefit beyond the standard of care therapy for COVID-19 patients requiring oxygen support, and hence will represent an important addition to the Merck pipeline of investigational medicines and vaccines designed to address the COVID-19 pandemic.”
Merck shares were marked 0.5% higher in early trading Monday, against a 0.67% gain for the S&P 500, to change hands at $80.88 each.
The Merck agreement followed data from AstraZeneca (AZN) - Get Report that indicated its coronavirus vaccine, developed in concert with Oxford University, reached a 90% efficacy rate in certain doses following late-stage trials in the U.K. and Brazil.
AstraZeneca said the average efficacy rate of the three dosage variants of its coronavirus vaccine, known as AZD1222, was around 70%, a much lower result than that achieved by Pfizer (PFE) - Get Report and Moderna's (MRNA) - Get Report messenger-RNA based techniques, but noted it can be stored and transported at normal refrigerated conditions.