Merck to acquire Australian biotech firm Viralytics for $394m to bolster oncolytic immunotherapy treatments

Significant Acquisition in Pharma Industry: US pharmaceutical giant Merck has announced a definitive agreement to acquire Viralytics, an Australian biotech company, for AUD 502 million (approximately $394 million). This acquisition is set to significantly enhance Merck’s portfolio in the burgeoning field of immuno-oncology.

Strategic Expansion of Immuno-Oncology Pipeline: Through this acquisition, Merck aims to expand its immuno-oncology pipeline by integrating Viralytics’ lead investigational oncolytic immunotherapy candidate, Cavatak (CVA21). Cavatak, a formulation derived from the Coxsackievirus Type A21—a common cold virus—has demonstrated promising anti-tumor activity in various clinical settings.

Details of the Deal and Therapeutic Advancements

Innovative Cancer Treatment Potential: Cavatak is designed to directly target and destroy cancer cells at the tumor site and throughout the body, utilizing the body’s own immune system. This approach aligns with Merck’s strategy to develop innovative monotherapy treatments and synergistic combinations to combat a wide range of cancers.

Clinical Trials and Collaborative Research: Viralytics has been actively evaluating Cavatak in numerous phase 1 and phase 2 clinical trials, both as an intratumoral and intravenous agent. Additionally, since 2015, Cavatak has been under study in combination with Merck’s blockbuster cancer drug, Keytruda, exploring potential treatments for melanoma, lung, prostate, and bladder cancers.

Industry Perspectives and Executive Insights

Comments from Merck’s Leadership: Roy Baynes, Senior Vice President and Head of Global Clinical Development, and Chief Medical Officer at Merck Research Laboratories, expressed enthusiasm about the acquisition. “Viralytics’s approach of engaging the innate immune system to target and kill cancer cells complements our immuno-oncology strategy,” he stated, emphasizing the goal to improve disease control and survival outcomes for cancer patients.

Viralytics’ Vision for the Future: Malcolm McColl, Managing Director and CEO of Viralytics, reflected on the acquisition as a culmination of years of dedication by the Viralytics team. He highlighted the opportunity for significant value creation for shareholders and the advancement of Cavatak under Merck’s leadership in immuno-oncology.

Anticipated Outcomes and Future Directions

Completion and Future Prospects: The acquisition is expected to be finalized by the second quarter of 2018, pending approval from Viralytics’ shareholders and receipt of customary regulatory approvals. The merger not only promises to enhance Merck’s capabilities in treating cancers but also aims to realize the full potential of Cavatak on a global scale.

Long-Term Impact on Cancer Treatment: This strategic acquisition positions Merck at the forefront of immuno-oncology research, potentially leading to breakthroughs in cancer treatments that leverage the body’s immune system more effectively.