Merck acquires Aus biotech Viralytics

Merck, also known as MSD, has acquired Australian listed cancer research firm Viralytics in a $502 million deal.

Viralytics, focused on oncolytic immunotherapy treatments for a range of cancers, owns the cancer drug CAVATAK (CVA21). The drug is based on Viralytics’ proprietary formulation of an oncolytic virus (Coxsackievirus Type A21) that has been shown to preferentially infect and kill cancer cells.

CAVATAK is currently being evaluated in multiple Phase 1 and Phase 2 clinical trials, both as an intratumoral and intravenous agent, including in combination with Merck’s KEYTRUDA (pembrolizumab), an anti-PD-1 therapy. Under an agreement between Viralytics and a subsidiary of Merck, announced in November 2015, a study is investigating the use of the CAVATAK and KEYTRUDA combination in melanoma, prostate, lung and bladder cancers.

“Viralytics’s approach of engaging the innate immune system to target and kill cancer cells complements our immuno-oncology strategy, which is focused on the rapid advancement of innovative monotherapy approaches and synergistic combinations to help the broadest range of cancer patients,” said Dr Roy Baynes, senior vice president and head of global clinical development, chief medical officer, Merck Research Laboratories. “We are eager to further build on Viralytics’ science as we continue our efforts to harness the immune system to improve long-term disease control and survival outcomes for people with cancer.”

“This proposed acquisition culminates years of dedicated work by the Viralytics team and represents an opportunity for significant value creation for our shareholders. Viralytics is proud to have progressed its lead investigational candidate CAVATAK to Phase 1 and Phase 2 clinical trials, and we believe that Merck, the leader in immuno-oncology, is best suited to advance CAVATAK for the benefit of patients globally, and to realise its potential,” said Dr Malcolm McColl, managing director and chief executive officer, Viralytics.