Danish biotechnology company Genmab announced its acquisition of Dutch oncology firm Merus for $97.00 per share in cash, valuing the transaction at approximately $5.2 billion. The deal represents a 41% premium over Merus's closing stock price of $68.89 on September 26, 2025, and marks the largest acquisition in Genmab's 25-year history.
Strategic Focus on Breakthrough Cancer Therapy
The acquisition centers on petosemtamab, Merus's EGFRxLGR5 bispecific antibody with potential to be both first- and best-in-class in head and neck cancer treatment. The U.S. Food and Drug Administration has granted petosemtamab two Breakthrough Therapy Designations for first- and second-line head and neck cancer indications, underscoring its clinical promise.
Compelling Phase 2 data presented at the American Society for Clinical Oncology (ASCO) 2025 Annual Meeting demonstrated both an overall response rate and median progression-free survival that were substantially higher than standard of care treatments. These results have positioned petosemtamab as a potentially transformative therapy in a challenging cancer indication.
Advanced Clinical Development Program
Merus is currently conducting two Phase 3 trials evaluating petosemtamab in first- and second/third-line head and neck cancer settings. The company anticipates topline interim readouts from one or both trials in 2026, which could support regulatory submissions and potential approval.
Based on Genmab's experience in late-stage development and commercial execution capabilities, the company anticipates the potential initial launch of petosemtamab in 2027, subject to clinical results and regulatory approvals. Genmab also plans to broaden and accelerate petosemtamab's development with potential expansion into earlier lines of therapy.
Commercial Projections and Financial Impact
Following its initial anticipated approval, Genmab believes petosemtamab will be accretive to EBITDA with at least one-billion-dollar annual sales potential by 2029. The company projects multi-billion-dollar annual revenue potential thereafter, reflecting the significant commercial opportunity in head and neck cancer treatment.
Transaction Structure and Financing
Under the transaction agreement, a wholly owned subsidiary of Genmab will commence a tender offer for all outstanding common shares of Merus. The closing requires satisfaction of customary conditions, including a minimum acceptance of at least 80% of Merus's common shares, which may be reduced to 75% at Genmab's discretion if other conditions are met.
The transaction will be funded through a combination of cash on hand and approximately $5.5 billion of non-convertible debt financing. Genmab has secured a funding commitment from Morgan Stanley Senior Funding, Inc. for this amount. The financing package includes a meaningful portion of prepayable debt, aligning with Genmab's commitment to deleveraging with a target of gross leverage below 3x within two years after closing.
Company Profiles and Strategic Rationale
Genmab, established in 1999 and headquartered in Copenhagen, has built a reputation for developing innovative antibody therapeutics over more than 25 years. The company's proprietary pipeline includes bispecific T-cell engagers, antibody-drug conjugates, next-generation immune checkpoint modulators, and effector function-enhanced antibodies.
Merus specializes in developing full-length human bispecific and trispecific antibody therapeutics, referred to as Multiclonics®. These therapeutics are manufactured using industry standard processes and have demonstrated in preclinical and clinical studies several features of conventional human monoclonal antibodies, including long half-life and low immunogenicity.
The acquisition reflects broader consolidation trends in the biotechnology sector, where established companies are pursuing strategic acquisitions to secure breakthrough technologies and promising drug candidates in competitive therapeutic areas.
