(Bloomberg) -- Merck & Co. agreed to acquire Pandion Therapeutics Inc., a biotechnology company developing therapies for autoimmune diseases, for $1.85 billion.
The agreement, worth $60 per share in cash, is at more than double the Cambridge, Massachusetts-based company's closing price Wednesday.
Pandion's potential treatment for ulcerative colitis and other autoimmune diseases, known as PT101, has completed a Phase 1a clinical trial that achieved its primary objective of safety and tolerability, the companies said in a statement.
The planned purchase comes about three weeks after Merck named Robert M. Davis to succeed Kenneth Frazier as chief executive officer, and about a month after it ended its Covid-19 vaccine program.
Pandion shares rose to just below the agreed price in premarket trading, with Merck up 0.5%.
Under the terms of the deal, Merck will initiate a tender offer for Pandion shares via a subsidiary. The deal is expected to close in the first half of the year.
Merck also recently agreed to buy VelosBio Inc. for $2.75 billion, moving to bolster its lineup of cancer therapies, and privately held biopharma company OncoImmune for an upfront $425 million to gain a potential therapy for severe Covid.
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