Biopharma big Merck is contemplating an acquisition of Seagen, the Seattle space’s largest biotech firm, in accordance with a report within the Wall Road Journal Friday.
The Journal reported that “talks have been beneath approach for some time, and a deal isn’t imminent.”
A spokesperson for Seagen declined to touch upon the report.
From Seagen’s perspective, an acquisition “might make a world of sense,” in accordance with William Canestaro, managing director on the Washington Analysis Basis, who mentioned the report took him without warning.
“Merck would deliver course of, techniques, and confirmed experience in bringing medication to market,” Canestaro instructed GeekWire. “Moreover, with the present turmoil in management, an acquisition now appears particularly well timed.”
Longtime CEO Clay Siegall, who co-founded the corporate greater than 24 years in the past, resigned in May within the wake of allegations of home abuse, which he denies, and an incident at his residence the place he was arrested. Chief medical officer Roger Dansey is appearing CEO.
Bothell, Wash.-based Seagen employs greater than 2,800 individuals within the Seattle space, Canada, and Europe. Seagen’s inventory worth was up greater than 11% on Friday at market shut, bringing the corporate’s market worth to greater than $30 billion. Merck inventory was down barely.
Seagen pulled in $1.6 billion in income final 12 months, and $426.5 million within the first quarter of 2022, in comparison with $332 million for year-ago interval. The corporate has 4 oncology medication available on the market and pipeline of different candidates centered on antibody-drug conjugates (ADCs), which zero in on cells utilizing an antibody and ship a toxin to kill the cells.
Seagen and Merck inked a partnership in 2020 to develop and commercialize an ADC for breast and different strong tumors as a monotherapy and together with Merck’s Keytruda. Underneath that settlement, Merck made a $1 billion fairness funding in Seagen and paid it $600 million up entrance.
Different corporations are additionally “eyeing Seagen,” the Journal reported.
Siegall’s resignation got here shortly after the corporate introduced that it’ll construct a 270,000 sq. foot manufacturing facility north of Seattle. The corporate has grow to be a big biotech anchor tenant for the area, which suffered from the lack of Amgen in 2016, years after its acquisition of Immunex.
Seagen and Bristol Myers Squibb are the Seattle space’s largest biopharma employers.
“Seagen has been an immensely vital a part of our native biotech ecosystem,” mentioned Canestaro. “With any acquisition questions naturally come up about whether or not this can look extra like an Immunex acquisition or a Juno acquisition.”
Bristol Myers Squibb acquired the pipeline of Juno Therapeutics by way of its acquisition of Celgene in 2018, and continues to develop within the area partially due to entry to cell remedy experience.
“Biologics and ADC experience can be simpler to search out in different elements of the nation so it might be unlikely that Seagen would keep the identical native footprint if it have been acquired,” added Canestaro. “However COVID basically modified how Seagen operates; a lot of their employees is now absolutely distant or hybrid. Location simply might not matter as a lot lately.”