Merck KGaA’s long-standing courtship of SpringWorks Therapeutics has finally come to a realization as the German drugmaker has purchased the Connecticut biopharma for an equity valuation of $3.9 billion, the company recently said.
The deal, which amounts to $47 per share, goes on to enhance Merck KGaA’s presence across the US and also throttles its oncology gamut since SpringWorks brings to the table a couple of approved drugs and also a handful of very rare disease pipeline candidates.
It is well to be noted that when the word for potential acquisition first went on to surface in early February 2025, SpringWorks’ share price saw a remarkable jump to up upto $60, and its market capital rose from $3 billion to $4 billion in an instant. However, as the rumors started to cool off by early April 2025, SpringWorks’ value had gone on to return to its previous mark.
But again, the report started coming back of renewed interest from companies for pulling off the transaction.
According to Merck KGaA, it had paid a premium of 26% that was based upon SpringWorks’ volume-weighted price of $37.38. This was on February 7, a day prior to the initial market speculation on the potential deal. Over the last five days, as the deal talks gained momentum again, Merck KGaA’s share price had jumped by 6%, while SpringWorks’ had increased by 21%.
The CEO of Merck KGaA, Belen Garijo, went on to call this buyout of SpringWorks a prominent step in their active portfolio strategy so as to position their company as a globally diversified technology powerhouse and an innovation hub.
It is well to be noted that outside of the Merck KGaA’s electronic business, buyout of SpringWorks goes on to represent the company’s largest acquisition deal ever since the 2015 buyout of Sigma Aldrich, based out of St. Louis, for $17 billion. The German giant also acquired Millipore, the Massachusetts manufacturer, for $7 billion in 2010 and also Serenity, the Swiss biotech, for $13.3 billion in 2006.
SpringWorks has its roots to 2016, when it happened to get spun-out of Pfizer, which had two drugs then in phase 3. The CEO of SpringWorks, Saqib Islam, said that they have successfully launched two of their best-in-class drugs in the US, and with the aspiration to go ahead and deliver their therapeutics worldwide, their journey is at a very crucial stage.
It is worth noting that SpringWorks got an FDI nod for Ogsiveo, which is the treatment for ultra-rare desmoid tumors, in late 2023. The drug is indeed off to a very promising launch and has achieved sales of $61 million in the fourth quarter of 2024.
A couple of months back, SpringWorks went on to get FDA approval for a MEK inhibitor named Gomekli in order to treat neurofibromatosis type one, which is a rare genetic disease. It is, in fact, the first treatment when it comes to adults and children having the disorder and is competing with Merck & AstraZeneca’s drug Koselugu, which got approved for the pediatric patients and touched sales of $631 million in 2024.
There are various pipeline candidates that are brought by SpringWorks. They include the likes of a cancer drug, which is an RAF diner inhibitor that the company happens to be developing along with Beigene, as well as SW-682, which is a TEAD inhibitor being investigated for hippo mutant solid tumors.
It is worth noting that analysts at ODDO BHF have given this acquisition a thumbs-up and have written to clients that it goes on to bring the healthcare business very positive prospects again.
