Writing | Ruo Xiao Shi
Editor | Fang Chen
On May 29, Merck & Co. and ophthalmic biotechnology company EyeBio announced that they had reached a definitive acquisition agreement. According to the terms of the agreement, Merck will acquire EyeBio for up to $3 billion (approximately 21.7 billion RMB) through its subsidiary, including $1.3 billion in upfront cash and $1.7 billion in potential development, regulatory, and commercial milestone payments. The transaction is expected to be completed in the third quarter of 2024.
EyeBio, founded in August 2021, has completed financing of 130 million US dollars so far. Its main clinical-stage drug, Restoret, aims to treat and prevent vision loss associated with retinal vascular leakage, and is a potential FIC tetravalent trispecific antibody.In February this year, EyeBio announced positive data from the Phase 1b/2a clinical trial of Restoret. The data showed that this treatment can not only improve the vision of patients with AMD and DME but also reduce the thickness of edema. Based on the existing results, Restoret is expected to enter the pivotal Phase 2b/3 clinical trial in the second half of this year.This move announces that Merck, after abandoning the ophthalmology market in earlier years to focus on treating cancer, immune diseases, and vaccines, has once again entered the ophthalmology sector.This strategic shift may partly be driven by the looming "patent cliff."In 2023, of Merck's total revenue of $59.871 billion, Keytruda alone contributed $25.011 billion, accounting for over 40%; the HPV vaccine contributed $8.886 billion, accounting for nearly 15%.However, the patent for K drug is expected to expire in 2028. In addition, Chinese vaccine manufacturers are accelerating the development of nine-valent HPV vaccines, with multiple products entering Phase 3 clinical trials, which may impact it. Many industry analysts believe that Merck is one of the MNCs most affected by patent expirations, with an estimated $55 billion in sales expected to lose patent protection between 2023 and 2030.Therefore, in recent years, Merck's BD and M&A activities have significantly accelerated. In April last year, the company acquired Prometheus Biosciences for approximately $10.8 billion; in October, it also reached a collaboration agreement with Daiichi Sankyo worth up to $22 billion to jointly develop the latter’s three ADC drugs: HER3-DXd, I-DXd, and R-DXd.The continuous increase in mergers and acquisitions and R&D investment caused Merck's net profit for the 2023 fiscal year to plummet by 97.49%.But this is not enough, we must continue this year.——At the earnings call in February, Merck CEO Rob Davis stated that the company is still on the lookout for acquisition deals ranging from $1 billion to $15 billion. "Although I am very satisfied with the progress we have made in expanding and diversifying our portfolio, we do believe there is a need for more."Looking ahead, in terms of market space and growth potential, ophthalmology is undoubtedly a track that cannot be ignored.In the ophthalmology field, Eylea (aflibercept), currently co-developed by Regeneron and Bayer, is the leading anti-VEGF therapy for treating retinal diseases, achieving $9.215 billion in sales last year. Of this, $5.885 billion came from sales in the United States (exclusively by Regeneron), while $3.495 billion came from markets outside the U.S. (managed by Bayer, with Regeneron receiving a share).Roche's Vabysmo (Faricimab) is also making significant strides. Vabysmo was first approved for marketing in the U.S. only at the beginning of 2022, yet its sales reached 2.357 billion Swiss francs (approximately 2.6 billion U.S. dollars) in 2023, with an impressive growth rate of 324%. It has become one of Roche’s top-selling "dark horse" drugs.Currently, Vabysmo has received FDA approval for three indications: diabetic macular edema (DME), wet age-related macular degeneration (wAMD), and macular edema secondary to retinal vein occlusion (RVO). In December 2023, Vabysmo was officially approved for marketing in China to treat diabetic macular edema under the trade name Luoshi Jia. At the beginning of January this year, it was again approved for a new indication to treat neovascular age-related macular degeneration.According to research data from Grand View Research,By 2030, the global AMD market size will increase from over USD 10 billion in 2022 to approximately USD 18 billion.Such a百亿赛道that has been verified by multiple parties, Merck naturally cannot afford to miss. Although finding the next "blockbuster drug" through "buying buying" is by no means easy, it can at least alleviate some anxiety.
