Merck Announces $10 Bn Acquisition of Verona Pharma

The acquisition grants Merck access to Verona Pharma’s COPD drug, Ohtuvayre, which received US approval over a year ago for treating adults with chronic obstructive pulmonary disease.

Pharmaceutical giant Merck is buying Verona Pharma, a company that focuses on respiratory diseases, in an approximately $10 billion deal as part of efforts to reduce dependence on its blockbuster cancer treatment.

The acquisition grants Merck access to Verona Pharma’s COPD drug, Ohtuvayre, which received US approval over a year ago for treating adults with chronic obstructive pulmonary disease.

Sharing thoughts, Robert Davis, Chairman and CEO Merck & Co, said in a statement, “Ohtuvayre complements and expands our pipeline and portfolio of treatments for cardiopulmonary diseases while delivering near- and long-term growth as well as value for shareholders.”

Ohtuvayre was launched last August as the first commercial product for London-based Verona Pharma. The drug is also being studied as a possible treatment for chronic obstructive pulmonary disease, a condition commonly called “smoker’s lung".

Reportedly, Merck is set to lose revenue from Keytruda, the world’s top-selling drug with nearly $30 billion in annual sales, as key patents begin to expire in 2028. It also plans to pay $107 for each Verona Pharma American Depository Share, representing eight of the company’s ordinary shares.

“Merck deal looks good at first glance. Given their home run with Prometheus and Winrevair, this (Ohtuvayre) looks like a potential complementary therapy,” said Kevin Gade, chief operating officer at Bahl & Gaynor.

As per reports, the deal announced has been approved by the boards of both companies and is expected to close in the fourth quarter, but it still needs Verona Pharma shareholder approval and sanction by the High Court of Justice of England and Wales.

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