Merck signs agreement to purchase Pandion Therapeutics

Biopharmaceutical firm Merck has announced that it has entered into a definitive agreement to purchase Pandion Therapeutics through a subsidiary, for a total equity value of about $1.85m.

Through its subsidiary, Merck will initiate a tender offer to acquire all outstanding Pandion shares, under the terms of the acquisition agreement. The tender offer closes subject to certain conditions. Merck’s subsidiary will be merged into Pandion once the tender offer is completed successfully. Close of transaction is expected to occur in the first half of 2021.

Clinical-stage biotechnology company Pandion develops novel therapeutics that are designed to address the unmet needs of patients suffering from autoimmune diseases.

Merck Research Laboratories president Dean Y. Li said: “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.”

Pandion is developing precision immune modulators that target critical immune control nodes. Heading this strike force is Pandion’s lead candidate PT101, an engineered IL-2 mutein fused to a protein backbone.

PT101 selectively activates and expands regulatory T cells (Tregs) and can be utilised for the potential treatment of ulcerative colitis and other autoimmune diseases.

Pandion announced earlier this year that PT101 had completed a Phase 1a clinical trial, achieving its primary objective of safety and tolerability.

Pandion Therapeutics CEO Rahul Kakkar said: “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 recognised 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.”

Merck’s financial advisor is Credit Suisse Securities (USA) LLC, while its legal advisor is Covington & Burling LLP.

Pandion’s financial advisor is Centerview Partners LLC, while Skadden, Arps, Slate, Meagher & Flom LLP acted as legal advisor.