Merck to acquire Curon Biopharmaceutical’s CN201 in strategic oncology expansion

Merck & Co., Inc. (NYSE: MRK), known as MSD outside the United States and Canada, has secured a pivotal acquisition by agreeing to purchase CN201, an investigational B-cell depletion therapy, from Curon Biopharmaceutical for $700 million in cash. This acquisition highlights Merck’s commitment to enhancing its oncology pipeline with cutting-edge therapies.

Strategic Acquisition Enhances Merck’s Oncology Portfolio

Merck, a global leader in pharmaceuticals, aims to strengthen its position in oncology with this acquisition. CN201, a novel bispecific antibody targeting B cells, is currently in advanced clinical stages. The agreement includes an additional potential $600 million in milestone payments contingent upon the successful development and regulatory approval of CN201. This strategic move is expected to bolster Merck’s capabilities in addressing B-cell malignancies and autoimmune disorders.

Dr. Dean Y. Li, President of Merck Research Laboratories, underscored the significance of CN201’s early clinical data, which demonstrates its potential to effectively target and deplete B cells. This capability could revolutionize treatments for a range of malignant and autoimmune diseases. Dr. Li expressed enthusiasm about integrating CN201 into Merck’s diverse portfolio, aligning with the company’s goal to broaden its therapeutic reach.

CN201: Clinical Trials and Promising Data

CN201 is a bispecific antibody designed to engage T cells against B cells, targeting CD3 and CD19 antigens. It is being evaluated in Phase 1 and Phase 1b/2 clinical trials for the treatment of relapsed or refractory non-Hodgkin’s lymphoma (NHL) and B-cell acute lymphocytic leukemia (ALL). Preliminary data from these trials suggest that CN201 is well-tolerated and effective in inducing substantial reductions in B-cell populations in patients with these hematologic malignancies.

The therapy’s innovative mechanism of action involves the simultaneous targeting of B cells by T cells, potentially offering a novel approach for treating B-cell associated cancers. This approach aligns with emerging trends in immunotherapy, where bispecific antibodies are gaining prominence for their ability to harness the immune system to combat cancer more effectively.

Curon Biopharmaceutical’s Role and Future Prospects

Curon Biopharmaceutical, a privately held biotechnology company incorporated in the Cayman Islands, has focused on developing bispecific antibodies and antibody-drug conjugates. With operations spanning Australia, Hong Kong, and Shanghai, China, Curon has established itself as a key player in the biopharmaceutical landscape. Zhihong Chen, President and Chief Executive Officer of Curon, highlighted the company’s pioneering work in immuno-oncology and expressed confidence in Merck’s ability to advance CN201’s development.

Transaction Details and Financial Implications

The acquisition is subject to regulatory approval under the Hart-Scott-Rodino Antitrust Improvements Act and other customary conditions. Merck expects the deal to close in the third quarter of 2024. The financial impact will be reflected in Merck’s results, with an anticipated pre-tax charge of approximately $750 million, including the upfront payment and related costs. This charge is expected to be approximately $0.28 per share and will be reported in Merck’s non-GAAP financial results for the quarter of the transaction closure.

Merck will provide an update on its financial outlook during the third-quarter 2024 earnings report. Hogan Lovells is serving as Merck’s legal advisor for this transaction, while Centerview Partners LLC and Goodwin Procter LLP are advising Curon Biopharmaceutical.

CN201 represents a significant advancement in targeted cancer therapies, designed to engage T cells against B cells for effective elimination. Curon Biopharmaceutical is renowned for its development of innovative cancer treatments through bispecific antibodies and antibody-drug conjugates. The company’s international presence and focus on cutting-edge research underscore its contribution to advancing oncology treatments.