Merck forays into acquiring Viralytics augmenting Immuno-Oncology Pipeline

Merck and Viralytics claimed that the companies have ventured into a definitive agreement that enumerates Merck’s acquisition of Viralytics emphasizing on oncolytic immunotherapy treatments for a range of cancers. The proposed acquisition values the total issued shares in Viralytics at approximately AUD 502 million (USD 394 million). The cash consideration of AUD 1.75 per share represents a premium of 160% to the one month volume weighted average price (VWAP) of Viralytics shares.

Viralytics will become a wholly-owned subsidiary of Merck, and Merck will gain full rights to CAVATAK (CVA21), Viralytics’s investigational oncolytic immunotherapy. CAVATAK is based on Viralytics’s proprietary formulation of an oncolytic virus (Coxsackievirus Type A21) that has been shown to preferentially infect and kill cancer cells.

Dr. Roy Baynes, senior vice president and head of global clinical development, chief medical officer, Merck Research Laboratories said “We are eager to further build on Viralytics’s science as we continue our efforts to harness the immune system to improve long-term disease control and survival outcomes for people with cancer.”

CAVATAK is currently being evaluated in multiple Phase 1 and Phase 2 clinical trials, both as an intratumoral and intravenous agent, including in combination with Merck’s KEYTRUDA(pembrolizumab), an anti-PD-1 therapy.

Dr. Malcolm McColl, managing director and chief executive officer, Viralytics said “This proposed acquisition culminates years of dedicated work by the Viralytics team and represents an opportunity for significant value creation for our shareholders. Viralytics is proud to have progressed its lead investigational candidate CAVATAK to Phase 1 and Phase 2 clinical trials and, we believe that Merck, the leader in immuno-oncology, is best suited to advance CAVATAK for the benefit of patients globally, and to realize its potential.”