Merck on Wednesday announced a deal worth $3 billion to buy EyeBio and its first-in-class trispecific antibody Restoret, marking the pharma’s return to the ophthalmology space after nearly a decade.
Merck announced on Wednesday it is acquiring privately held biotech EyeBio in a potential $3 billion bid to diversify its pipeline and reestablish itself as a major player in the ophthalmology space.
Under the terms of the agreement, Merck will pay $1.3 billion upfront and put $1.7 billion on the line in developmental, regulatory and commercial milestones. The acquisition has been unanimously approved by the EyeBio Board of Directors. Merck will carry out the purchase through a subsidiary.
The companies expect to complete the transaction in the third quarter of 2024, pending clearance under the Hart-Scott-Rodino Antitrust Improvements Act and other customary closing conditions.
Dean Li, president of Merck Research Laboratories, said in a statement that the EyeBio purchase plays into its “science-led business development strategy to expand and diversify our pipeline.” The acquisition will also give Merck the biotech’s “promising pipeline of candidates targeting retinal diseases,” Li added.
The focus of Wednesday’s buyout is Restoret. Also known as EYE103, Restoret is an investigational and potentially first-in-class trispecific antibody being developed for diabetic macular edema (DME) and neovascular age-related macular degeneration (NVAMD).
The candidate works by activating the Wnt signaling pathway, which according to the biotech’s website is disrupted in DME and NVAMD, resulting in a weakened endothelial cell barrier and fluid leakage into the retina. Restoret’s mechanism of action allows it to restore the integrity of the eye endothelial cells and prevent vascular leakage.
Based on early data, Restoret is expected to enter a pivotal Phase IIb/III study in DME in the second half of 2024, according to the companies.
The EyeBio acquisition marks Merck’s return to the ophthalmology space after it exited the market in 2014, selling off its assets to Akorn Pharmaceuticals and Santen Pharmaceutical.
BMO Capital Markets in a Wednesday note to investors said that while the EyeBio deal was on the smaller side, the firm was “encouraged by the progress Merck continues to make diversifying its revenue base” ahead of the loss of exclusivity for blockbuster Keytruda.
The buyout also continues a dealmaking spree for the pharma, which in April 2024 bought the small biotech startup Abceutics for $208 million, gaining access to technology that could help improve the safety of antibody-drug conjugates.
In March 2024, Merck signed a $1 billion contract with Pearl Bio to develop engineered biologics. Based on research from Yale researchers, Pearl Bio’s tech uses synthetic amino acids—outside of the 20 naturally occurring ones—that in theory could yield proteins with enhanced therapeutic activity.
In January 2024, Merck also dropped $680 million to buy cancer-focused Harpoon Therapeutics and its pipeline of T-cell engagers designed for different types of cancers.
Tristan Manalac is an independent science writer based in Metro Manila, Philippines. Reach out to him on LinkedIn or email him at tristan@tristanmanalac.com or tristan.manalac@biospace.com.
