Antibody specialist Genmab has continued its shift from out-licensing drugs to developing its own medicines with a deal to buy Merus and its lead drug candidate for head and neck cancer for around $8 billion.
Denmark and Netherlands-based Genmab is buying its Nasdaq-listed Dutch rival for $97 per share, nearly 10 times the value of its shares when it went public in 2016 and a 41% premium on Merus’ closing price on Friday. Shares in Merus were trading up nearly 40% pre-market at the time of writing.
The deal revolves around petosemtamab, Merus’ EGFRxLGR5 bispecific antibody, which is currently in one phase 3 trial in combination with MSD’s PD-1 inhibitor Keytruda (pembrolizumab) as a first-line treatment for metastatic head and neck squamous cell carcinoma (HNSCC), and another as a second- and third-line therapy for relapsed/refractory patients.
Phase 2 results with the combination as a first-line treatment achieved a 63% response rate among 43 evaluable patients and a 79% overall survival rate at 12 months.
The two phase 3 studies – called LiGeR-HN1 and LiGeR-HN2 – are due to complete enrolment before the end of the year and generate results in 2026. Merus has picked up breakthrough designations from the FDA for both first- and later-line indications, and has said it is hoping to launch petosemtamab in 2027.
GlobalData has forecast that sales for the bispecific will reach around $1.2 billion in 2030, ahead of rival therapy from Bicara Therapeutics, EGFR and TGF-beta-targeting bispecific fusion protein ficerafusp alfa, which is targeting a similar indication but a little further behind in clinical development. It expects 2030 sales of Bicara’s drug to be around $620 million.
Genmab said that it plans to finance the acquisition through a combination of cash and around $5.5 billion in debt. The transaction has been unanimously approved by the boards of both companies.
The deal continues its transition from a partner for drug developers to a company developing its own drugs, which has also seen it make other bolt-on deals, including a $630 million alliance with Scancell last December that is focusing on another cancer antibody.
Jan van de Winkel, Genmab’s chief executive, said buying Merus “clearly aligns with our long-term strategy. It has the potential to significantly accelerate our evolution into a global biotechnology leader by providing durable growth for the company well into the next decade.”
After building up an extensive portfolio of antibody therapies sold by other drugmakers and generating royalties, Genmab has started selling its own medicines, starting when it took the commercial lead on AbbVie-partnered lymphoma therapy Epkinly (epcoritamab).
Since then, it has been building its in-house pipeline, and the Merus deal follows a $1.8 billion acquisition of antibody-drug conjugate (ADC) developer ProfoundBio, which completed last year, and added three clinical-stage ADCs for cancer, headed by FRα-targeting rinatabart sesutecan (Rina-S) for solid tumours.
