Brimarafenib

Germany's Merck KGaA has bought out rare disease specialist SpringWorks for $3.9 billion. Connecticut-based SpringWorks is a 2017 spin out of Pfizer. Merck KGaA’s long courtship of SpringWorks Therapeutics has come to fruition as the German drugmaker has bought out the Connecticut biopharma for an equity value of $3.9 billion, the companies said on Monday.The deal, which works out to $47 per share, enhances Merck KGaA’s presence in the U.S. and bolsters its oncology portfolio, as SpringWorks brings two approved drugs and a handful of rare disease pipeline candidates.  When word of the potential acquisition first surfaced in early February, SpringWorks’ share price shot up to $60 and its market cap rose from $3 billion to $4 billion. But as the rumors had cooled by early this month, SpringWorks’ value had returned to its previous level.Then last week came reports of renewed interest from the companies in pulling off the transaction.Merck KGaA said that it paid a premium of 26% based on SpringWorks’ volume-weighted price of $37.38 on February 7, which was the day prior to the initial market speculation about a potential deal.Over the last five days, as deal talks ginned back up, Merck KGaA’s share price has increased by 6%, while that of SpringWorks grew by 21%.In a statement, Merck KGaA CEO Belén Garijo called the buyout “a major step in our active portfolio strategy to position our company as a globally diversified, innovation and technology powerhouse.”Outside of Merck KGaA's electronics business, the SpringWorks deal represents the company's largest acquisition since its 2015 buyout of St. Louis manufacturing specialist Sigma-Aldrich for $17 billion. The German company also acquired Massachusetts manufacturer Millipore for $7 billion in 2010 and Swiss biotech Serono for $13.3 billion in 2006.SpringWorks traces its roots to 2017, when it was spun out of Pfizer with two drugs then in phase 3, which have since been approved. “We have successfully launched two best-in-class medicines in the United States, and with the aspiration to deliver our therapies worldwide, our journey is at a pivotal juncture,” Saqib Islam, CEO of SpringWorks, said in a release. In late 2023, SpringWorks earned an FDA nod for Ogsiveo, a treatment for ultra-rare desmoid tumors. The drug is off to a promising launch, achieving sales of $61 million in the fourth quarter and $172 million for 2024.Two months ago, SpringWorks gained FDA approval for MEK inhibitor Gomekli to treat neurofibromatosis type 1 (NF1), a rare genetic disease. It is the first treatment for adults and children with the disorder and is competing with AstraZeneca and Merck's (U.S.) drug Koselugo, which was approved for pediatric patients and rang up sales of $631 million in 2024. Pipeline candidates brought by SpringWorks include cancer drug brimarafenib, an RAF dimer inhibitor which the company is developing along with BeiGene, and SW-682, a TEAD inhibitor which is being investigated for Hippo-mutant solid tumors.Analysts at ODDO BHF gave the acquisition a thumbs up, writing to clients that it “brings to the healthcare business some positive prospects again.”