Merck to Acquire EyeBio for Up to $3 Billion to Enter Ophthalmology Market
EyeBio
Ophthalmic Disease Therapeutics Developer
MSD
Pharmaceutical R&D and Manufacturer
On May 29, according toFinancial TimesReport: MSD has signed a deal worth up to $3 billion to acquire EyeBio, a move that will propel MSD into the large and growing ophthalmic care market.
EyeBio CEO David Guyer and UK venture capitalist Kate Bingham, who supported EyeBio's startup, stated that Merck & Co., Inc. will pay $1.3 billion in cash upfront and could pay EyeBio an additional $1.7 billion upon achieving corresponding milestones.
However, as of the time of writing, neither MSD nor EyeBio had issued an official announcement on their websites.The Wall Street JournalThe report cited sources familiar with the matter as saying that the deal could be announced as early as May 30.
MSD's venture capital arm is one of the investors in EyeBio. EyeBio's leading drug, Restoret, is under development for the treatment of eye diseases, including age-related macular degeneration.（AMD）, this disease can lead to blurred vision or even blindness. Elderly people suffering from this condition are referred to as having wet AMD, where part of the retina deteriorates and fluid leakage occurs in the blood vessels.
Publicly available information introduces that Restoret is injected once a month, which can restore the strength of the blood-retinal barrier and prevent leakage. The drug has recently completed mid-term testing and is being developed for the treatment of wet AMD as well as another condition known as diabetic macular edema.（DME）Ocular diseases.
Wet AMD represents a large and highly lucrative therapeutic market. According to the Cleveland Clinic, approximately 2 million people in the U.S. are affected by this condition. Data from Grand View Research indicates that the global AMD market size is expected to grow from over $10 billion in 2022 to nearly $18 billion by 2030.
Currently, including Eylea developed by Regeneron(Sales reached $5.9 billion in 2023)And Vabysmo developed by Roche(Sales reached $2.7 billion in 2023)Including the drug, have been approved for the treatment of wet AMD.
Guyer said more data was needed to determine whether Restoret could compete with or be used in combination with AMD drugs developed by Bayer and Genentech — their mechanisms of action are different. MSD will continue to advance the late-stage trials of the drug for treating AMD and DME.
MSD once sold some ophthalmic drugs, but about 10 years ago, it abandoned the market and divested its remaining products. Since then, MSD has focused on drugs for treating cancer and immune diseases, as well as selling vaccines and animal health products.
In recent years, Rob Davis, CEO of Merck & Co., Inc., has been conducting asset transactions to reduce the company's reliance on its blockbuster cancer immunotherapy, Keytruda.Keytruda is the company's best-selling drug, is expected to lose patent protection for its main product in 2028.
In the fiscal year 2023, Keytruda accounted for more than 40% of Merck & Co., Inc.'s $60 billion in sales. The deals led by Davis include last year’s $10.8 billion acquisition of Prometheus Biosciences and the $11.5 billion acquisition of Acceleron Pharma in 2021.
By acquiring Acceleron, MSD has gained a newly approved product named Winrevair. Analysts predict that the drug’s sales will reach several billion dollars and help MSD diversify its business beyond Keytruda.
MSD also hopes to gain momentum from the upcoming FDA approval of the new pneumococcal vaccine V116. The PDUFA target date for this 21-valent vaccine is June 17, 2024. If approved, V116 will become the first pneumococcal conjugate vaccine specifically designed for adults.
EyeBio, founded in 2021, has operations in both the UK and the US, and has raised a total of $130 million in approximately two years.The Wall Street JournalIndicates that as EyeBio and MSD reached this acquisition agreement, large-scale M&A activities in the pharmaceutical industry have become quieter. Previously, by the end of 2023,Pharmaceutical Industry Sees a Series of Major Deals。
Industry insiders analyze that pharmaceutical companies tend to seek relatively smaller-scale deals to address the upcoming patent cliff. Meanwhile, the ophthalmic care market has drawn the interest of pharmaceutical companies.
Last year, Bausch+Lomb acquired a dry eye drug from Novartis for $1.75 billion, while a Japanese pharmaceutical companyAstellas Acquires Iveric Bio for $5.9 Billion——One of the founders is Guyer, who currently leads EyeBio——to strengthen its capabilities in the ophthalmology field.
