Merck, known as MSD outside the US and Canada, has agreed to acquire UK-based biopharmaceutical company Verona Pharma for about $10bn to enhance its portfolio.
Under the terms of the agreement, Merck will purchase American Depository Shares (ADS) for $107 each, which represent eight ordinary shares of Verona Pharma.
The acquisition has been unanimously approved by the boards of both companies and will proceed via a scheme of arrangement under UK law.
The transaction is expected to be completed in the fourth quarter of this year, subject to regulatory approvals and certain closing conditions.
The conditions include the Hart-Scott-Rodino Antitrust Act, Verona Pharma shareholder approval, and sanction by the High Court of England and Wales.
Merck said the acquisition aligns with its science-led strategy and will drive growth.
Merck chairman and CEO Robert Davis said: “This acquisition of Verona Pharma reflects the commitment we have to delivering innovative treatments to patients and our ability to execute on our science-led and value-driven business development strategy.
“Ohtuvayre complements and expands our pipeline and portfolio of treatments for cardio-pulmonary diseases while delivering near- and long-term growth as well as value for shareholders.
“This novel, first-in-class treatment addresses an important unmet need for COPD patients persistently symptomatic based on its unique combination of bronchodilatory and non-steroidal anti-inflammatory effects.”
As part of the acquisition, Merck will add Ohtuvayre (ensifentrine), a selective dual inhibitor of phosphodiesterase 3 and 4 (PDE3 and PDE4), into its cardio-pulmonary pipeline.
Ohtuvayre has been approved by the US Food and Drug Administration (FDA) in June last year, as an inhaled treatment for Chronic obstructive pulmonary disease (COPD).
The drug combines bronchodilator and non-steroidal anti-inflammatory effects. It is currently being evaluated for the treatment of non-cystic fibrosis bronchiectasis.
Citi and Morgan Stanley served as financial advisors, and Freshfields provided legal counsel to Merck on the transaction.
Centerview Partners served as an exclusive financial advisor, while Latham & Watkins provided legal advice to Verona Pharma.
Verona Pharma president and CEO David Zaccardelli said: “Today’s announced agreement with Merck is the culmination of years of focus and determination by the Verona Pharma team advancing Ohtuvayre, the first novel inhaled mechanism for the maintenance treatment of COPD in two decades.
“Since launching Ohtuvayre in August 2024 we have seen rapid and accelerating uptake in the US. We believe Merck’s commercial footprint and industry-leading clinical capabilities will help accelerate the potential of Ohtuvayre to reach more patients living with COPD.
“This agreement will enable the strong launch trajectory of this important medicine and provides value to Verona Pharma shareholders.”
