Back to top

Image: Bigstock

Merck to Buy ArQule for $2.7B to Boost Cancer Portfolio

Read MoreHide Full Article

Merck & Co., Inc. (MRK - Free Report) announced that it has entered into a definitive agreement to acquire Massachusetts-based small biopharmaceutical company ArQule, Inc. for $2.7 billion to boost its oncology portfolio. Under the terms of the deal, Merck has offered to buy all outstanding shares of ArQule for $20 per share in cash, representing a premium of almost 104% to the latter’s Friday closing price of $9.66.

The acquisition of ArQule will strengthen Merck’s oncology pipeline with the addition of some strategic assets including ARQ 531.

ArQule’s lead pipeline candidate ARQ 531, an oral BTK inhibitor, is currently being evaluated in phase II dose expansion study for the treatment of B-cell malignancies. In early clinical studies, the candidate demonstrated a manageable safety profile and showed signs of anti-tumor activity for treating patients with relapsed/refractory chronic lymphocytic leukemia (CLL) and Richter’s Transformation.

ArQule has several other pipeline candidates in early-stage development for addressing various types of indications, mainly cancer.

The deal is expected to close in the first quarter of 2020. With this acquisition, Merck is looking to further diversify its oncology portfolio with expansion into targeted therapies that treat hematological malignancies.

Shares of Merck have rallied 16.1% so far this year, outperforming the industry’s increase of 7.2%.



If the buyout gets through, this will be the fourth company to be acquired by Merck in little more than a year. In 2019, the company already purchased Peloton, Immune Design and Tilos to brace its cancer pipeline.

On Monday, French pharma giant Sanofi (SNY - Free Report) also announced a definitive agreement to acquire small cancer biotech Synthorx, Inc. for $2.5 billion to drive its immuno-oncology portfolio. This takeover deal also saw a hefty premium of more than 170% offered by Sanofi to acquire all the outstanding shares of Synthorx for $68 per share (Fridays’ closing price $25.03) in cash.

We remind investors that the current year already witnessed a flurry of M&A deal announcements including the two mega-merger declarations of Bristol-Myers Squibb (BMY - Free Report) -Celgene and AbbVie-Allergan.

Zacks Rank

Merck currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Today's Best Stocks from Zacks

Would you like to see the updated picks from our best market-beating strategies? From 2017 through Q3 2019, while the S&P 500 gained +39.6%, five of our strategies returned +51.8%, +57.5%, +96.9%, +119.0%, and even +158.9%.

This outperformance has not just been a recent phenomenon. From 2000 – Q3 2019, while the S&P averaged +5.6% per year, our top strategies averaged up to +54.1% per year.

See their latest picks free >>


In-Depth Zacks Research for the Tickers Above


Normally $25 each - click below to receive one report FREE:


Sanofi (SNY) - free report >>

BristolMyers Squibb Company (BMY) - free report >>

Merck Co., Inc. (MRK) - free report >>