Merck continues to expand oncology pipeline with $773m deal

By Vassia Barba & Ben Hargreaves

- Last updated on GMT

(Image: Getty/Natali_Mis)
(Image: Getty/Natali_Mis)

Related tags: Merck, TGF-β, MSD, Cancer

Merck acquires Tilos, a biopharmaceutical developer targeting the latent TGFβ complex for the treatment of cancer, fibrosis and autoimmune diseases.

Following the agreement, Merck, known as MSD outside of the US and Canada, will acquire all of Tilos Therapeutics’ shares for up to $773m (€683m), through an unspecified upfront payment and contingent milestone payments.

Tilos holds a portfolio of drug candidates that modulate the potent transforming growth factor beta (TGF-β) cytokine by binding it to latency-associated peptide (LAP), with potential applications across a range of diseases.

The company suggests that its anti-LAP antibodies could be used to “enhance the power of the immune system,”​ potentially addressing the issue where immuno-oncology treatments are “only effective in a minority of patients and in a subset of cancers.”

This approach could be used to complement Merck’s big-selling PD-L1 cancer treatment​, Keytruda (pembrolizumab), while Dean Li, SVP of discovery and translational medicine at the company noted that adding Tilos would ‘enhance’ Merck’s pipeline.

The strategic angle to combine a TGF-β with a PD-L1 treatment is one already being explored by Merck KGaA, alongside GSK, after the latter agreed a $3.7bn deal​ to opt-in on development of M7824.

Moving quickly

Tilos was only founded three years ago, with financial support from the Boehringer Ingelheim Venture Fund and Partners Innovation Fund, with additional investment by the ShangPharma Innovation Fund.

The development of TGF-β treatments was based on discoveries by the laboratory of Howard Weiner at Brigham and Women’s Hospital and Harvard Medical School.

Barbara Fox, Tilos’ CEO, stated that “[The company] has advanced the discoveries of our scientific founders by developing a portfolio of anti-LAP antibodies designed to realize the full potential of TGF-β-modulating therapeutics.”

Tilos’ drug research is currently still at the pre-clinical stage.

The acquisition adds to Merck’s strategy of investing in bolt-on, early-stage research biotechs. Last month​, the company acquired Peloton Therapeutics for a potential figure of $2.2bn, just prior to an anticipated initial public offering (IPO) by the biotech.

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