Merck (MRK) To Buy Pandion Therapeutics (PAND) In $1.85 Billion Deal

By Amit Chowdhry ● February 25, 2021
  • Merck (NYSE: MRK) is buying Pandion Therapeutics, Inc. (Nasdaq: PAND) in a deal valued at $1.85 billion. These are the details.

Merck (NYSE: MRK) — known as MSD outside the United States and Canada — and Pandion Therapeutics, Inc. (Nasdaq: PAND) announced today that the companies have entered into a definitive agreement, under which Merck through a subsidiary will buy Pandion, a clinical-stage biotechnology company developing novel therapeutics designed to address the unmet needs of patients living with autoimmune diseases for $60 per share in cash. And this represents an approximate total equity value of $1.85 billion.

Pandion is advancing the pipeline of precision immune modulators targeting critical immune control nodes. And Pandion’s lead candidate PT101 is an engineered IL-2 mutein fused to a protein backbone designed to selectively activate and expand regulatory T cells (Tregs) for the potential treatment of ulcerative colitis and other autoimmune diseases. And earlier this year, Pandion announced that PT101 had completed a Phase 1a clinical trial, which achieved its primary objective of safety and tolerability. The company’s pipeline also includes PD-1 agonists in development for numerous autoimmune diseases.

Under the terms of the deal, Merck through a subsidiary will initiate a tender offer to acquire all outstanding shares of Pandion. And the closing of the tender offer will be subject to certain conditions, including the tender of shares representing at least a majority of the total number of Pandion’s shares of fully-diluted common stock, the expiration of the waiting period, and other customary conditions. 

Upon the successful completion of the tender offer, Merck’s acquisition subsidiary is going to be merged into Pandion. And any remaining shares of common stock of Pandion will be canceled and converted into the right to receive the same $60 per share price payable in the tender offer. The deal is expected to close in the first half of 2021.

KEY QUOTES:

“This acquisition builds upon Merck’s strategy to identify and secure candidates with differentiated and potentially foundational characteristics. Pandion has applied its TALON technology to develop a robust pipeline of candidates designed to re-balance the immune response with potential applications across a wide array of autoimmune diseases.”

— Dr. Dean Y. Li, president, Merck Research Laboratories

“Pandion grew out of our founders’ personal and scientific mission to change the way patients living with autoimmune diseases are treated. In just a few years, we have taken that mission from idea to clinical proof of mechanism with PT101, our lead IL-2 mutein. We are proud that Merck has recognized our team’s innovation and drive in creating a pipeline of diverse candidates that activate natural immune regulatory mechanisms and thereby have the potential to achieve better clinical responses for patients. We believe Merck is well positioned to bring our novel approach to the millions of those living with autoimmune diseases, and we look forward to seeing these molecules progress in the clinic.”

— Dr. Rahul Kakkar, chief executive officer, Pandion Therapeutics