Merck has struck a deal to buy Peloton Therapeutics for $1.1 billion upfront days before the biotech was due to list on Nasdaq. The deal will give Merck control of an experimental oral HIF-2α inhibitor that could challenge Keytruda for the metastatic renal cell carcinoma (mRCC) market.
Peloton was due to go public this week and raise $150 million or more to bankroll a late-phase trial of HIF-2α inhibitor PT2977 in mRCC patients previously treated with at least one checkpoint inhibitor, such as Merck’s Keytruda. But a late offer from Merck has persuaded the biotech to switch lanes, taking a buyout that represents a premium on the IPO terms even before milestones are factored in.
All told, Merck could pay $1.2 billion in milestones on top of the $1.1 billion cash upfront. In return, Merck will gain a drug that is due to move into phase 3 later this year on the strength of data from 55 mRCC patients who had received at least one prior line of therapy.
The trial linked PT2977 to a partial response rate of 24%. A further 54% patients had stable disease as of the March 15 cutoff, resulting in an overall clinical benefit rate of 78%. At 40 weeks, of follow-up the probability of progression-free survival was 50.1%. Seventeen patients, some of whom had been taking PT2977 for more than 70 weeks, remained on treatment as of the last cutoff.
Roger Perlmutter, president of Merck Research Laboratories, called the activity seen so far in mRCC “intriguing,” adding in a statement that he plans to advance the late-stage asset. Merck is due to take ownership of Peloton in the third quarter.
Peloton is already working to generate data on PT2977 in additional contexts, including through a phase 2 that is administering the drug in combination with Exelixis’ Cabometyx. The trial is assessing the combination in treatment-naive patients and people previously treated with immunotherapies.
Testing of PT2977 in patients with glioblastoma multiforme (GBM) is underway, too, creating an additional overlap between the indications targeted by Merck and Peloton. Merck’s alkylating agent Temodar is one of the drugs Peloton planned to challenge by bringing PT2977 to market in GBM.