Merck KGaA is spending $1.3 billion to buy Silence Therapeutics, a 130% premium that marks the second-highest markup on a major biotech deal this year. The German group will pay $20 in cash per U.S.-listed share for a clinical-stage asset that has yet to start a pivotal trial, betting that its balance sheet can finish a development program the UK company could not afford alone.
The asset and the competition
The prize is divesiran, a short-interfering RNA therapy targeting the TMPRSS6 gene to treat polycythemia vera, a rare blood disorder where excess red blood cells raise clotting risk. Phase 2 data showed the drug significantly reduced the need for therapeutic phlebotomy, the standard practice of drawing blood to manage the disease, and lowered hematocrit levels below the treatment threshold in more patients than placebo. If approved, divesiran would enter a market recently opened by Mimrylo, a hepcidin-mimicking peptide from Takeda and Protagonist Therapeutics, alongside established treatments such as Incyte’s Jakafi and hydroxyurea.
Wall Street reads the data
Cantor Fitzgerald analysts argued that divesiran’s efficacy profile could allow a smaller Phase 3 program than the nearly 300 patients enrolled in Mimrylo’s pivotal trial. They also concluded the Silence candidate “meaningfully exceeded the efficacy shown by” its newly approved rival, raising the prospect of a best-in-class label. William Blair’s Myles Minter characterized the transaction as removing execution risk in a competitive space and delivering near-term value from what appeared to be a competitive bid process.
Cash versus runway
Silence held $72 million in cash and equivalents at the end of June, a runway insufficient for a global Phase 3 program in a rare disease. Merck KGaA, by contrast, can fund the study without dilution or partnership constraints. The deal follows last year’s Springworks acquisition, which delivered two already-approved oncology drugs. This time, the German buyer is paying a steep premium for binary clinical risk, with closing targeted for the first quarter of 2027 contingent on shareholder and regulatory approvals. Key holders representing 14% of voting power have already agreed to tender.