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Merck  (MRK - Get Report) reached an agreement to buy Tilos Therapeutics, a privately held biopharmaceutical company, for up to $773 million.

Tilos develops therapeutics for the treatment of cancer, fibrosis and autoimmune diseases, Merck said in a press release announcing the acquisition.

"At Merck we continue to enhance our robust pipeline through active execution of our business development strategy," said Dr. Dean Li, senior vice president, discovery and translational medicine, for Merck Research Laboratories. "Tilos has developed a compelling portfolio of candidates that employ a novel approach to modulating the potent signaling molecule TGFβ by binding to latency-associated peptide, with potential applications across a range of disease indications."

The deal for Tilos will include an upfront payment as well as contingent milestone payments, Merck said.

Merck declined 0.6% to $81.95 in trading Monday.