The transaction is expected to close in the 2023 third quarter, with the purchase price a 75% premium against last week’s  market closing.

Merck’s interest is seen to have been aroused by the biotech’s drug candidate PRA023, an anti-TL1A monoclonal antibody that impressed with positive date from a Phase 2 trial late last year.

TL1A has been seen to modulate the location and severity of inflammation and fibrosis, leading researchers to identify the protein as a way to treat inflammatory bowel disease.

The Prometheus trial’s results showed that 26.5% of ulcerative colitis patients in the PRA023 cohort went into clinical remission by week 12, compared to 1.5% of their peers on placebo. The antibody was also seen to improve outcomes in Crohn’s disease.

“The agreement with Prometheus will accelerate our growing presence in immunology where there remains substantial unmet patient need,” Merck CEO Robert Davis said in a statement, adding that “this transaction adds diversity to our overall portfolio and is an important building block as we strengthen the sustainable innovation engine that will drive our growth well into the next decade.”

Analysts said Merck has been looking for a promising candidate to deflect biosimilar competition when the patent for its megablockbuster Keytruda in expires in the US in 2028. If PRA023 delivers on its mid-phase promise, they believe it could provide Merck with a series of new growth opportunities as it works to expand the label. 

Quoting analysts, Prometheus has calculated that the inflammatory bowel disease market could be worth more than $49 billion by 2030.

Pfizer has been nurturing a similar ulcerative colitis drug of its own, which it in December last year brought into a development joint venture with Roivant that will push the candidate toward Phase 3 trials.

Author: Dede Williams, Freelance Journalist