Merck acquires OncoImmune to broaden its vary of promising Covid medicine

Pharmaceutical company Merck plans to acquire privately owned OncoImmune for $ 425 million in cash, acquiring rights to an under-the-radar drug that has had remarkable results in hospitalized patients with Covid-19.

The drug CD24Fc showed in a late-stage clinical trial in September that it reduced the risk of respiratory failure or death by more than 50% in patients hospitalized with Covid-19 who require oxygen, Merck said Monday.

The drug was given as an intravenous infusion in addition to the standard of treatment, which might include remdesivir and dexamethasone, and compared to the standard of treatment alone. The data in 203 patients also showed that patients who received CD24Fc were 60% more likely to see improved clinical status.

“The results are remarkable,” said Merck’s head of research, Dr. Roger Perlmutter in a telephone interview.

With cases of Covid averaging nearly 170,000 a day in the US and a record number of people hospitalized with the disease, a drug that could greatly speed recovery and reduce the risk of death or of patients becoming so seriously ill could that they need ventilators made a big difference in the pandemic.

But there is one problem: supply.

“We found that this small company is unable to manufacture CD24Fc to treat all of the people who could potentially benefit from this drug,” said Perlmutter. “We have decided that the only way that can seriously be brought to people who need it is by drawing on our skills.”

Merck plans to relocate some of its manufacturing capacity to begin manufacturing the drug. But it is a complex drug to be made, and it will take time. Perlmutter said he was aiming for adequate care “before the middle of next year and ideally well before that”.

OncoImmune, founded and led by Yang Liu, director of the immunotherapy department at the University of Maryland Medical School, posted key findings from the study on its website in September. They have not yet been published in a peer-reviewed journal. Merck says detailed results are coming.

Although the results barely attracted the world’s attention, Moncef Slaoui, chief adviser to the US government’s Operation Warp Speed, noticed one person who noticed. In a telephone interview on Nov. 1, he noted that the data for OncoImmune’s drug were “simply incredible” and that “a relative effect on mortality is very clear”.

Slaoui said the drug prevents the immune system from becoming “hyperactivated”. It’s the same reason the steroid dexamethasone was shown to be so effective in treating patients in more severe stages of Covid-19 in a study back in June. When patients get this sick, it may be their own immune system going into high gear causing problems, not the virus.

“To be honest, no one would have believed that this would have such an effect,” said Perlmutter when asked why the CD24Fc results received so little attention. “When you look at the other anti-inflammatory drugs that have been studied in very sick Covid-19 patients, it’s hard to show that there is any effect at all.”

In addition to having the potential to help with the pandemic, Merck has acquired OncoImmune because it sees opportunities for CD24Fc outside of Covid. It has shown promise for graft-versus-host disease, a dangerous immune response that can occur after a bone marrow transplant, and Perlmutter said there may be other uses as well.

The $ 425 million deal has the potential for additional payments based on certain regulatory milestones. However, Merck will only receive CD24Fc while OncoImmune is spinning off other rights and assets into a new company that Merck will invest $ 50 million in.

The company has no plans to get emergency approval from the Food and Drug Administration until it has enough medicine for people to actually use it, Perlmutter said. That is now the job of Merck, which is also developing a pill for Covid and two vaccines against the disease.

“Now that we have this terrible, terrible surge in Covid-19 cases and so many people are hospitalized in severe or critical condition and so many people could be in intensive care units, tens of thousands or possibly hundreds of thousands or more just in the United States need this drug, “said Perlmutter. “We’ll move heaven and earth to produce the material.”

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