(Bloomberg) -- Merck & Co. agreed to pay as much as $610 million to acquire Caraway Therapeutics Inc., a developer of drugs in laboratory testing for neurological and rare diseases.
Caraway is working on therapies that take advantage of cells’ ability to filter toxic substances in an effort to prevent and curb damage, according to its website. The Cambridge, Massachusetts, company has programs focused on ALS and Parkinson’s disease, among others.
Merck is shopping for new products to replace revenue from its blockbuster Keytruda cancer drug that brought in about $21 billion in revenue last year while it inches toward patent expiration and the threat of generic competition. In October, Merck agreed to pay up to $22 billion to gain rights to sell three cancer drugs from Daiichi Sankyo Co.
Caraway’s drugs target a cellular structure called the lysosome that contains digestive enzymes and breaks down proteins. The deal includes an undisclosed upfront payment and contingent payments for reaching certain goals, the companies said Tuesday in a statement.
Merck’s shares were little changed as of 12:15 p.m. in New York.
--With assistance from Nacha Cattan.
(Updates shares in final paragraph)
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