Merck KGaA pays $230M for four Vertex cancer programs

Merck kgaa
The deal gives Merck rights to Vertex compounds that have delivered solid early clinical data.

Merck KGaA has paid Vertex Pharmaceuticals $230 million (€219 million) upfront for the rights to four cancer programs. The deal bulks up Merck’s oncology pipeline through the addition of phase 1/2 DNA repair programs and a preclinical immuno-oncology project.

VX-970, one of two compounds in Vertex’s ataxia telangiectasia and Rad3-related (ATR) protein kinase inhibitor program, is the most advanced of the assets to change hands. Vertex posted phase 1 data last year linking VX-970 to partial responses in platinum-resistant patients with advanced solid tumors.

The tolerability and early efficacy data suggested VX-970 was worth pursuing—a point backed up by its inclusion in eight ongoing National Cancer Institute-sponsored trials—but it also falls outside of Vertex’s core areas of focus.

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The same cannot be said for Merck, which has made oncology the centerpiece of its attempt to get its R&D operation back on track after years of missteps in the clinic. Since striking a landmark immuno-oncology deal with Pfizer, Merck has continued to advance its own candidates, which will now be joined in the pipeline by the Vertex compounds.

Merck is buying VX-970 along with another ATR inhibitor, VX-803. The oral candidate, like VX-970, is designed to kill cancer cells by selectively inhibiting ATR, a key regulator of DNA damage repair in tumors. VX-803 is being tested in a phase 1 solid tumor trial.

VX-984, another of the compounds bought by Merck, tackles DNA damage repair from a different angle. The asset is a DNA-dependent protein kinase (DNA-PK) inhibitor that also targets the system for repairing DNA. Merck is familiar with the mechanism of action as it is developing its own DNA-PK inhibitor, M3814, an early-stage candidate it started talking up more than a year ago.

With the Vertex deal also giving Merck two preclinical programs—and its own labs pumping out candidates such as PD-L1-TGFβ bifunctional immunotherapy M7824—the German company now has a pipeline capable of supporting combination therapies, a key battleground in the future of cancer care.

For Vertex, the deal gives it a cash boost to support investment in its core business. Jefferies Analyst Brian Abrahams called the deal “a surprise incremental positive” in a note to investors, adding that it could free up Vertex to strike its own deals to boost its cystic fibrosis pipeline.

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