Organon keeps pedal to the metal, buying up Forendo in 3rd deal since spinning out of Merck

The rat-a-tat-tat pace of dealmaking at Merck spinout Organon continues. Having identified more than 140 clinical-phase assets in its wheelhouse, Organon has pulled the trigger on its third deal in six months by agreeing to buy Forendo Pharma for an initial $75 million.

Organon went solo equipped with a portfolio of 64 products but without a pipeline of new prospects to drive growth in the years to come. Management outlined plans to build a pipeline by consolidating the most promising candidates in the fragmented women’s health landscape—and is already well on its way to delivering on the strategy.

The latest deal sees Organon agree to pay $75 million upfront to buy Forendo for its experimental treatment for endometriotic lesions. The lesions develop in women who grow tissue similar to the lining of the womb in other places, including the ovaries and fallopian tubes. 

Forendo’s lead drug candidate, FOR-6219, is designed to inhibit a conversion process that results in the estradiol hormone. Estradiol regulates the growth of uterine tissue and can cause inflammation and pain in women with endometriosis, leading Forendo to speculate that it can improve symptoms by blocking the conversion process.

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Organon’s interest in FOR-6219 reflects the potential for the small molecule to act locally and leave systemic hormone levels unchanged. If Organon and Forendo are right, FOR-6219 could meet the need for a long-term treatment for endometriosis. FOR-6219 is entering phase 2 development.

If FOR-6219 makes it past phase 2, the value of the deal could start to mushroom. Organon is set to pay up to $270 million in development and regulatory milestones, with a further $600 million in play if FOR-6219 makes it to market. All told, Organon could end up paying close to $1 billion for Forendo in the unlikely event that all the milestones are triggered.