- Merck agreed to acquire Prometheus Biosciences in a deal worth $10.8 billion.
- Shares of Prometheus Biosciences were up 70% in early trading on Monday following the announcement.
- Merck shares dipped slightly on the news.
Shares of Prometheus Biosciences (RXDX) jumped on Monday after the maker of intestinal inflammatory disease treatments said it will be acquired by Merck, as the drug maker seeks to diversify its product line.
In a deal worth $10.8 billion, Merck (MRK) agreed to acquire Prometheus Biosciences at a price of $200 per share, a 75% premium to Friday's closing price. The deal for Prometheus is expected to close in the third quarter.
Prometheus Biosciences Chair and CEO Mark McKenna said that deal would maximize the potential for its lead product, a drug aimed to target intestinal inflammation diseases like ulcerative colitis and Crohn’s disease, “while continuing to apply our technology and expertise to fuel further discoveries to address the needs of patients with immune disorders.”
The acquisition will add diversity to Merck’s portfolio as it seeks to tap into new markets, said Robert M. Davis, the company’s chair and chief executive.
“The agreement with Prometheus will accelerate our growing presence in immunology where there remains substantial unmet patient need,” Davis said.
Shares of Prometheus Biosciences were up 70% in early trading on Monday following the announcement. Merck shares dipped slightly on the news.