American pharmaceutical major Merck & Co is acquiring clinical-stage biopharmaceutical firm Imago BioSciences, a portfolio company of Malaysian venture capital firm Xeraya Capital, for $1.35 billion in cash.
The deal marks Xeraya Capital’s exit from the biopharma firm. Xeraya first invested in the company in May 2019.
In a statement, the NYSE-listed Merck said it will acquire Imago, through a subsidiary, for $36 per share, to expand its portfolio of blood disorder treatments.
Founded in 2012 and headquartered in California, Imago BioSciences is focused on developing novel therapeutics for the treatment of blood cancers. It listed on Nasdaq in July 2021 at an IPO price of $16 per share.
Imago’s lead candidate bomedemstat (IMG-7289), an investigational orally available lysine-specific demethylase 1 (LSD1) inhibitor, is currently being evaluated in multiple Phase 2 clinical trials for the treatment of essential thrombocythemia (ET), myelofibrosis (MF), and polycythemia vera (PV), in addition to other indications.
Under the terms of the acquisition agreement, Merck will initiate a tender offer to acquire all outstanding shares of Imago. The closing of the tender offer will be subject to certain conditions.
Upon the completion of the acquistion, Merck’s subsidiary will be merged into Imago, and any remaining shares of common stock of Imago will be cancelled and converted into the right to receive the same $36 per share price payable in the tender offer.
The transaction is expected to close in the first quarter of 2023.
“This acquisition of Imago augments our pipeline and strengthens our presence in the growing field of hematology,” said Merck president and CEO Robert M. Davis.
In a separate post, Xeraya Capital CEO Fares Zahir said the acquisition is a “much welcome news indeed in light of current difficult market conditions”.
Aside from Xeraya Capital, Imago BioSciences’ early investors also include Blackstone Life Sciences, Frazier Healthcare, Omega Funds, Amgen Ventures, and MRL Ventures Fund.
“This milestone is a testament to more than a decade of pioneering research by Imago scientists and the entire Imago team’s unwavering dedication to improving the lives of patients,” said Dr. Hugh Y. Rienhoff, Jr., founder and CEO of Imago BioSciences.