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 The companies added they would co-develop and sell Seattle
Genetics's cancer therapy, ladiratuzumab vedotin. (https://reut.rs/3bWTEvS)
The collaboration will assess ladiratuzumab vedotin in combination
with Merck's blockbuster drug Keytruda in types of breast cancer and
other solid tumors, the companies said in a joint statement.
Seattle Genetics, a cancer-focussed drug developer, will receive an
upfront payment of $600 million under the agreement, while Merck
will invest the $1 billion to buy 5 million shares of Seattle
Genetics for $200 per share, a premium of 33.4% to Seattle's last
close.
This would amount to a stake of nearly 2.9%, according to Refinitiv
IBES data.
Shares of Seattle Genetics were up nearly 12% at $167.48 in
premarket trade, while Merck shares were largely unchanged.
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Merck has been trying to push deeper to expand its cancer portfolio and struck a
$2.7 billion deal with ArQule Inc in December to tap into the drug developer's
experimental blood cancer therapy that targets genetic mutations.
Seattle Genetics is also eligible for additional milestone payments of up to
$2.6 billion.
Separately, Seattle Genetics has also given Merck exclusive license to sell its
cancer therapy Tukysa in Asia, the Middle East and Latin America and other
regions outside of the U.S., Canada and Europe.
The company will receive upfront payment of $125 million from Merck for the
same, with additional milestone payments of up to $65 million.
(Reporting by Trisha Roy in Bengaluru; Editing by Rashmi Aich)
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