New York, United States–Pharmaceutical giant Merck announced Sunday the purchase of California-based biotech company Prometheus Biosciences for nearly $11 billion.
The two companies “have entered into a definitive agreement under which Merck, through a subsidiary, has agreed to acquire Prometheus for $200.00 per share in cash for a total equity value of approximately $10.8 billion,” Merck said in a statement.
Prometheus’s share price was at $114.01 when the New York Stock Exchange closed on Friday.
The company is developing a treatment for autoimmune diseases, including ulcerative colitis and Crohn’s disease, dubbed PRA023.
“The agreement with Prometheus will accelerate our growing presence in immunology where there remains substantial unmet patient need,” said Merck chairman and CEO Robert Davis, according to the statement.
The transaction diversifies Merck’s portfolio and will help drive its “growth well into the next decade,” he added.
Merck’s financial results were better than expected in the fourth quarter of 2022 thanks in part to strong sales of its cancer drugs, and despite a decline in its anti-Covid treatment molnupiravir.
From September to December, sales at the company, known as MSD outside the United States and Canada, were $13.8 billion, up two percent year-on-year.