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Mereo to acquire OncoMed
Posted on Thursday, 06 December 2018 11:24
Mereo BioPharma has reached an agreement to acquire OncoMed Phamaceuticals for USD 57.40 million in an all-stock deal that will broaden its asset and shareholder base and extend its enlarged cash runway.

The UK-headquartered drug company, which is focused on developing therapies for rare diseases, is paying a 34.0 per cent premium to the US-based oncology clinical-stage products manufacturer’s close of USD 1.11 on 4th December, the last trading day prior to the announcement.

Mereo is offering 23.70 million new ordinary shares to OncoMed’s stockholders.

Both boards have already given the green light to the deal, which remains subject to approvals from investors, regulators and the listing/admission of the acquiror’s shares on Nasdaq.

Closing is currently slated for the first half of next year and will create a business with a combined portfolio of seven assets, resulting in an increased number of potential near-term catalysts with a core focus remaining on Mereo’s strategy to target orphan diseases.

Mereo’s chief executive Dr Denise Scots-Knight said that in 2019 she is expecting several value inflection points, including the data from a phase 2b clinical trial for its osteogenesis imperfecta candidate BPS-804, as well as the phase 2 study for MPH-966, which treats antitrypsin deficiency, both of which are being run in the US and Europe.

OncoMed has three therapeutic drugs in active development that target cancer stem-cell pathways and immuno-oncology.

The group is also focused on pursuing additional candidates for cancer treatments.

In the six months to 30th September 2018, OncoMed generated revenue of USD 32.24 million, an 84.0 per cent increase on USD 17.52 million in the corresponding period of 2017.

Net loss totalled USD 3.44 million in the first half of fiscal 2018, compared to a loss of USD 48.53 million in H1 2017.

According to Zephyr, the M&A database published by Bureau van Dijk, the deal joins the 1,619 transactions that have targeted the pharmaceutical and medicine manufacturing industry worldwide since the start of 2018.

The largest of these by far involved Takeda agreeing to acquire UK-based Shire for GBP 46.00 billion.

© Zephus Ltd