The pharmaceutical firm will pay $425m up-front for University of Michigan and Ohio State University-founded OncoImmune after the latter pivoted its research pipeline to target severe cases of covid-19.
OncoImmune, a US-based covid-19 treatment developer leveraging University of Michigan and Ohio State University research, is set to be acquired by drug developer Merck & Co in a $425m all-cash transaction.
Merck & Co will acquire OncoImmune through a subsidiary subject to customary regulatory conditions, with the deal anticipated to close before the end of 2020.
In addition to the up-front cash payment, OncoImmune’s exiting shareholders will receive money on the achievement of certain regulatory outcomes and a revenue-share if the spinout’s programme is successful.
Founded in 2000, OncoImmune is currently undertaking phase 3 clinical trials on a proposed treatment, CD24Fc, for severe and critical covid-19 cases.
OncoImmune’s non-covid 19 assets, for diseases such as cancer, will now be spun out into a new entity to be owned by its existing shareholders, with the addition of Merck, which will inject $50m in equity funding.
HM Capital and an unnamed investor co-led a $56m series B round for OncoImmune that closed in September 2020 with contributions from GF Xinde, an investment affiliate of brokerage firm GF Securities, as well as GBA Fund, 3E Bioventures Capital and Kaitai Capital.
OncoImmune had collected $750,000 of equity funding five months previously according to a regulatory filing, after 3E Bioventures had led a $15m series A round for the spinout in 2017.
