Four months after Immune Design halted a late-stage study for its lead cancer vaccine and saw its stock price cut nearly in half, the immunotherapy company is now in line to join Merck’s pipeline in a deal worth approximately $300 million.
Merck (NYSE: MRK announced Thursday that it has agreed to pay $5.85 per share in cash to acquire Immune Design (NASDAQ: IMDZ). Shares of the Seattle company, which also has operations in South San Francisco, CA, closed at $1.42 on Wednesday.
Immune Design develops vaccines intended to prompt an immune response to fight cancer. The company says its immunotherapies activate the body’s ability to create cytotoxic T cells that are specific to the patient’s tumors.
The company’s vaccine candidate CMB305 had advanced to Phase 3 testing as a treatment for synovial sarcoma, a rare and aggressive soft tissue cancer. But last October, Immune Design reported that a separate study testing that drug in combination with Roche’s atezolizumab (Tecentriq) showed the treatment was unlikely to improve survival in relapsed synovial sarcoma patients. Based on the results, Immune Design announced it would stop the Phase 3 test of CMB305—news that sank the company’s shares.
Immune Design turned its focus to G100, an experimental treatment for lymphomas. The company is currently recruiting follicular non-Hodgkin’s lymphoma patients for a Phase 1/2 study. The company has also said it plans to test G100 in combination with Merck cancer immunotherapy pembrolizumab (Keytruda).
Merck already has a presence in cancer vaccine research and development. Nearly three years ago, it inked a $200 million deal to work with Moderna (NASDAQ: MRNA) to develop cancer vaccines based on the messenger RNA work of the Cambridge, MA-based company. Merck and Moderna have since expanded the alliance, and vaccines from that partnership are now in clinical testing in combination with pembrolizumab.
In a research note, SVB Leerink analyst Jonathan Chang wrote that adding Immune Design’s proprietary technologies will bolster Merck’s vaccine capabilities. He added that it’s unlikely other bidders will emerge at this point.
Merck expects to close the Immune Design acquisition early in the second quarter of this year. Here’s more on the origins of Immune Design.
Image by the National Cancer Institute