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Merck Bags Tilos, Adding an Immunotherapy Booster to Its Arsenal

Xconomy Boston — 

Cancer immunotherapy leader Merck continued to roll up oncology assets with a deal this morning to acquire privately held Tilos Therapeutics.

Merck (NYSE: MRK) didn’t disclose how much it will pay up front for Tilos, a Lexington, MA, startup developing drugs for cancer, fibrosis, and autoimmune diseases. But the overall payout could reach $773 million for Tilos shareholders, which include Boehringer Ingelheim Venture Fund, Partners Innovation Fund, and ShangPharma Innovation Fund.

Tilos was spun out of research by neuroscientists Galina Gabriely and Howard Weiner at Bringham and Women’s Hospital. In a paper published in Science Immunology in 2017, the two reported that an antibody targeting a protein called latency-associated peptide, or LAP—an antibody they were studying to try to determine the biological underpinnings of multiple sclerosis—might be useful as a cancer treatment. The drug appeared to tip off regulatory T cells—which help regulate the body’s immune response—to the presence of tumors. Tilos planned to explore the use of anti-LAP antibodies as potential treatments for cancers of the head and neck, lung, liver, and more.

That caught the eye of Merck, which has been amassing different ways to broaden the reach of its blockbuster cancer immunotherapy pembrolizumab (Keytruda). Only a fraction of patients respond to immunotherapies like pembrolizumab, which rev up a person’s immune system against a tumor. And one of the reasons the response rates aren’t higher is that some patients’ immune systems don’t see the tumor. The race is on to boost those results by pairing immunotherapies with other drugs.

The Tilos buyout is the third recent oncology-focused deal for Merck, which bought cancer immunotherapy developer Immune Design for $300 million in February and followed that up with a $2.2 billion buyout of Peloton Therapeutics and its experimental kidney cancer drug in May. Merck believes the Tilos assets might have use in a “range of disease indications” beyond cancer as well, the company said in a statement.

Here’s more on Merck and its immuno-oncology strategy.