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Merck is nearing a deal to buy Cidara Therapeutics, a drugmaker pioneering a long-acting flu antibody treatment, after besting rival pharmaceutical groups in a bidding war that went down to the wire, according to people familiar with the matter.
A deal valuing Cidara at a premium to its $3.3bn market capitalisation could be announced as soon as Friday, provided it did not hit any last minute snags, the people said. Merck was still vying with another pharmaceutical group for the biotech late on Thursday, before the seller favoured its offer.
The heated private negotiations are the latest example of a scrap between pharmaceutical companies for a promising drug in development. Earlier this month, a public bidding war broke out between Pfizer and Novo Nordisk for weight-loss biotech Metsera, which ultimately sold to the US drugmaker for up to $10bn after a week of back-and-forth offers.
The deal will boost Merck’s efforts to grapple with the loss of revenue from its blockbuster cancer drug Keytruda coming off patent by 2028. Merck in July struck a $10bn deal to buy respiratory biotech Verona Pharma, as it accelerates its dealmaking to contend with its imminent patent cliff.
The exact price of the deal could not immediately be established. Any deal would likely include cash and the promise of future payments when clinical trial milestones are hit. Merck and Cidara did not immediately respond to requests for comment.
The recent surge in biotech deals highlights renewed hunger among large drugmakers for new cutting edge medicines. The XBI biotech index is up 45 per cent over the past six months as investors bet on a wave of Big Pharma acquisitions.
Cidara’s lead drug, an antibody treatment for the two most common strains of flu, is pitched as a possible alternative to flu vaccines to better protect vulnerable patients. The drug is being studied in phase-three trials on immunosuppressed patients, people who cannot take vaccines and healthy individuals aged 65 and over. By the end of the month, more than 6,000 patients worldwide will be enrolled in the trials.
Shares in the San Diego-based biotech have quadrupled in value since July because of strong clinical data, leading investors to believe that the company could be a takeover candidate. The drug, known as CD388, has received breakthrough designation from the US Food and Drug Administration, allowing its approval to potentially be fast-tracked.
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