(Bloomberg) -- Merck & Co. is in advanced talks to acquire cancer drugmaker Harpoon Therapeutics Inc. for about $700 million, people familiar with the matter said, as it seeks to solidify its leadership position in the profitable oncology space.
A deal could be announced within days assuming talks don't fall apart, the people said, asking not to be identified because the information was private. Merck is discussing paying roughly $23 a share for South San Francisco-based Harpoon, the people said.
The drugmaker is looking for new sources of growth as its top-selling medicine, the cancer immunotherapy Keytruda, is likely to face pricing pressure at the end of this decade. Keytruda generated $20.9 billion in 2022, making it one of the best-selling drugs in the world.
A representative for Merck declined to comment. A spokesperson for Harpoon didn't immediately respond Sunday to a request for comment.
Harpoon, whose stock has gained 41% in the past year, closed at $10.55 a share in New York trading Friday.
Harpoon is developing drugs that harness the body's immune system to fight cancer, including a type of lung cancer and multiple myeloma. Its technology involves T-cell engagers, drugs that aim to use a patient's own immune system to kill tumor cells. The company's lead candidate targets a molecule called delta-like ligand 3 that is expressed at high levels in small cell lung cancer and neuroendocrine tumors.
It's currently in an early stage trial as a single agent for patients with certain advanced cancers and is being studied in combination with an existing immunotherapy for small cell lung cancer.
Merck has been actively building its new product portfolio with outside drug candidates. In October, it agreed to buy the rights to sell Daiichi Sankyo Co.'s three experimental cancer drugs in a deal that involved $4 billion upfront and as much as $22 billion in potential future payments. In April, Merck announced an $10.8 billion deal for Prometheus, a maker of autoimmune drugs.
--With assistance from Robert Langreth and Nacha Cattan.
(Updates with details on Merck's Keytruda in the third paragraph)
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