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MRK to Buy Cidara for $9.2B: Focus on Buyout Spree Heading Into 2026
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Key Takeaways
MRK offers to acquire Cidara for $9.2B, which will add phase III influenza candidate CD388 to its portfolio.
The acquisition will expand MRK's respiratory offerings and support its long-term growth outlook.
CD388 offers broad seasonal and pandemic flu protection with a single injection and novel mechanism.
Merck (MRK - Free Report) has made substantial investments in strategic mergers and acquisitions (M&A) deals over the past few years to build a more durable long-term portfolio and reinforce its growth prospects.
Last week, Merck announced a definitive agreement to acquire San Diego-based biotech Cidara Therapeutics (CDTX - Free Report) for $221.50 per share in cash, a total deal value of almost $9.2 billion. The deal will expand Merck’s respiratory portfolio by adding Cidara’s lead pipeline candidate, CD388, which is being developed for the prevention of influenza A and B.
The transaction is expected to close in the first quarter of 2026, subject to customary closing conditions.
CD388, developed using CDTX’s proprietary Cloudbreak platform, is an investigational drug-Fc conjugate designed as a long-acting small molecule inhibitor targeting influenza. The candidate is currently being evaluated in the phase III ANCHOR study for treating patients who stand at a high risk for complications of influenza.
Unlike vaccines or monoclonal antibodies, CD388 works through a novel mechanism that offers broad protection against both seasonal and pandemic flu strains. CD388 has the potential to protect for an entire flu season with a single injection, and its efficacy does not rely on the body’s immune response. This makes it a promising option for individuals with any immune status.
The FDA has granted a Fast Track designation and a Breakthrough Therapy designation to CD388 for the prevention of seasonal influenza.
The proposed acquisition of Cidara comes on the heels of Merck's recent acquisition of Verona Pharma for approximately $10 billion, which closed last month. The acquisition added Verona’s Ohtuvayre, which is approved for the maintenance treatment of COPD. The deal strengthens Merck’s cardio-pulmonary portfolio, as the drug’s differentiated profile provides a significant edge over its competitors.
During the third-quarter conference call, management emphasized that strategic business development remains a key priority.
MRK is actively assessing potential targets to pursue further meaningful investments aimed at driving the next phase of growth and creating sustainable value for shareholders. The company has struck multi-billion-dollar deals with Chinese biotechs like Hansoh Pharma, LaNova Medicines and Hengrui Pharma in recent times to expand its broader pipeline.
These deals broaden MRK’s portfolio beyond the blockbuster PD-L1 inhibitor Keytruda, reduce heavy reliance on oncology and introduce first-in-class or near-market therapies with strong commercial potential, positioning it for durable revenue expansion over the next decade.
M&A Deals to Carry the Momentum in 2026?
M&A activity has picked up at a significant pace recently in the pharma/biotech sector. The recent deals suggest that big companies are pursuing innovation-driven biotech acquisitions rather than large-scale consolidation. Another noticeable trend is the shift in therapeutic focus — with M&A momentum moving away from oncology toward metabolic and cardio-metabolic diseases and respiratory, where long-term growth potential now appears stronger.
Pfizer (PFE - Free Report) closed the acquisition of obesity drug developer, Metsera, earlier this month after a fierce bidding war with Danish pharma giant Novo Nordisk (NVO - Free Report) .
NVO already has a strong presence in the obesity market.
Pfizer acquired Metsera for $65.60 per share in cash, reflecting a total value of around $7 billion, and a contingent value right of up to $20.65 in cash.
The acquisition of Metsera is likely to help Pfizer tap into the lucrative obesity and cardiometabolic disease market, given that it failed to develop its own obesity candidate earlier this year.
Sanofi recently acquired Blueprint Medicines for a total deal value of up to $9.5 billion. With this transaction, Sanofi added Ayvakit — an inhibitor of KIT and PDGFRA proteins with growing commercial traction — and several early-stage pipeline assets focused on systemic mastocytosis.
MRK's Price Performance, Valuation and Estimates
Year to date, shares of Merck have lost 6.5% against the industry’s rise of 14%. The stock has also underperformed the sector and the S&P 500 during the same time frame, as seen in the chart below.
Image Source: Zacks Investment Research
From a valuation standpoint, Merck appears attractive relative to the industry. Going by the price/earnings ratio, the company’s shares currently trade at 10.04 forward earnings, lower than 16.72 for the industry and its five-year mean of 12.57.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for 2025 earnings per share has moved up from $8.94 to $8.97, while the same for 2026 has decreased from $9.56 to $9.29 over the past 60 days.
Image: Shutterstock
MRK to Buy Cidara for $9.2B: Focus on Buyout Spree Heading Into 2026
Key Takeaways
Merck (MRK - Free Report) has made substantial investments in strategic mergers and acquisitions (M&A) deals over the past few years to build a more durable long-term portfolio and reinforce its growth prospects.
Last week, Merck announced a definitive agreement to acquire San Diego-based biotech Cidara Therapeutics (CDTX - Free Report) for $221.50 per share in cash, a total deal value of almost $9.2 billion. The deal will expand Merck’s respiratory portfolio by adding Cidara’s lead pipeline candidate, CD388, which is being developed for the prevention of influenza A and B.
The transaction is expected to close in the first quarter of 2026, subject to customary closing conditions.
CD388, developed using CDTX’s proprietary Cloudbreak platform, is an investigational drug-Fc conjugate designed as a long-acting small molecule inhibitor targeting influenza. The candidate is currently being evaluated in the phase III ANCHOR study for treating patients who stand at a high risk for complications of influenza.
Unlike vaccines or monoclonal antibodies, CD388 works through a novel mechanism that offers broad protection against both seasonal and pandemic flu strains. CD388 has the potential to protect for an entire flu season with a single injection, and its efficacy does not rely on the body’s immune response. This makes it a promising option for individuals with any immune status.
The FDA has granted a Fast Track designation and a Breakthrough Therapy designation to CD388 for the prevention of seasonal influenza.
The proposed acquisition of Cidara comes on the heels of Merck's recent acquisition of Verona Pharma for approximately $10 billion, which closed last month. The acquisition added Verona’s Ohtuvayre, which is approved for the maintenance treatment of COPD. The deal strengthens Merck’s cardio-pulmonary portfolio, as the drug’s differentiated profile provides a significant edge over its competitors.
During the third-quarter conference call, management emphasized that strategic business development remains a key priority.
MRK is actively assessing potential targets to pursue further meaningful investments aimed at driving the next phase of growth and creating sustainable value for shareholders. The company has struck multi-billion-dollar deals with Chinese biotechs like Hansoh Pharma, LaNova Medicines and Hengrui Pharma in recent times to expand its broader pipeline.
These deals broaden MRK’s portfolio beyond the blockbuster PD-L1 inhibitor Keytruda, reduce heavy reliance on oncology and introduce first-in-class or near-market therapies with strong commercial potential, positioning it for durable revenue expansion over the next decade.
M&A Deals to Carry the Momentum in 2026?
M&A activity has picked up at a significant pace recently in the pharma/biotech sector. The recent deals suggest that big companies are pursuing innovation-driven biotech acquisitions rather than large-scale consolidation. Another noticeable trend is the shift in therapeutic focus — with M&A momentum moving away from oncology toward metabolic and cardio-metabolic diseases and respiratory, where long-term growth potential now appears stronger.
Pfizer (PFE - Free Report) closed the acquisition of obesity drug developer, Metsera, earlier this month after a fierce bidding war with Danish pharma giant Novo Nordisk (NVO - Free Report) .
NVO already has a strong presence in the obesity market.
Pfizer acquired Metsera for $65.60 per share in cash, reflecting a total value of around $7 billion, and a contingent value right of up to $20.65 in cash.
The acquisition of Metsera is likely to help Pfizer tap into the lucrative obesity and cardiometabolic disease market, given that it failed to develop its own obesity candidate earlier this year.
Sanofi recently acquired Blueprint Medicines for a total deal value of up to $9.5 billion. With this transaction, Sanofi added Ayvakit — an inhibitor of KIT and PDGFRA proteins with growing commercial traction — and several early-stage pipeline assets focused on systemic mastocytosis.
MRK's Price Performance, Valuation and Estimates
Year to date, shares of Merck have lost 6.5% against the industry’s rise of 14%. The stock has also underperformed the sector and the S&P 500 during the same time frame, as seen in the chart below.
Image Source: Zacks Investment Research
From a valuation standpoint, Merck appears attractive relative to the industry. Going by the price/earnings ratio, the company’s shares currently trade at 10.04 forward earnings, lower than 16.72 for the industry and its five-year mean of 12.57.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for 2025 earnings per share has moved up from $8.94 to $8.97, while the same for 2026 has decreased from $9.56 to $9.29 over the past 60 days.
Image Source: Zacks Investment Research
MRK's Zacks Rank
Merck currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.