Approximately one month after Seagen (Nasdaq:SGEN) CEO Clay Siegall resigned following a domestic abuse arrest, Merck & Co. (NYSE:MRK) is considering purchasing the company, according to WSJ.
One potential hurdle is the possibility of increased antitrust enforcement from the DOJ and FTC focused on the pharmaceutical sector.
To sidestep such risks, the two companies could enter a joint marketing arrangement instead, according to the WSJ article, which cited anonymous sources. The two companies have already had strategic collaborations in oncology.
Investors reacted to the news by sending SGEN shares up almost 13% to $165.45.
Merck shares were mostly flat, closing at $84.62.
Last year, Merck generated $48.7 billion in revenue. More than one-third of it, however, came from the immunotherapy drug Keytruda (pembrolizumab). Keytruda patent protections are set to expire in 2028.
Seagen had $1.6 billion in revenue in 2021.
In April, Merck president Rob Davis said in the Q1 2022 earnings call that the company was preparing for a post-Keytruda loss of exclusivity period by continuing to build on the company’s existing oncology levers and “building upon them in order to deliver long-term growth.”
Last year, Merck completed an acquisition of Acceleron Pharma Inc. for roughly $11.5 billion.