Pharmaceutical leader Merck & Co. Inc. (NYSE: MRK) is currently in active discussions with Revolution Medicines Inc. (NASDAQ: RVMD), a California-based biotechnology company focused on cancer therapies, regarding a potential acquisition worth an estimated $28 billion to $32 billion. This development has led to a significant increase in Revolution Medicines’ stock value, which saw a 4.56% gain preceding the announcement followed by a substantial 15.14% surge in overnight trading, closing at $123.65 per share.
The deal remains unconfirmed with sources familiar with the matter indicating that any formal agreement could take several weeks to materialize. Should the acquisition proceed, it would be among the most substantial transactions in the biotech industry in recent memory, trailing only behind Pfizer’s $43 billion acquisition of Seagen in 2023. This trend coincides with a vigorous merger and acquisition cycle within the biotechnology sector, where deal volumes are projected to reach approximately $135 billion in 2025, effectively doubling from figures seen in 2024, according to S&P Capital IQ data.
Merck’s pursuit of Revolution Medicines takes place in the context of an impending patent expiration landscape that poses challenges to pharmaceutical companies. Notably, Merck’s flagship cancer drug, Keytruda, faces a patent cliff in 2028, underscoring the pharmaceutical giant’s motivation to diversify and strengthen its oncology portfolio through strategic acquisitions.
This move follows recent acquisitions by Merck including the $9.2 billion purchase of Cidara Therapeutics Inc. (NASDAQ: CDTX) for its influenza drug pipeline and the $10 billion acquisition of Verona Pharma plc earlier the previous year, illustrating a continued expansion strategy across varied therapeutic areas.
Revolution Medicines is advancing several early-stage clinical trials, with a particular focus on targeted therapies aimed at slowing tumor growth in pancreatic cancer, which remains one of the most lethal cancer types with limited effective treatment options. Earlier this year, the company secured $2 billion in funding via a partnership with Royalty Pharma Plc. (NASDAQ: RPRX) to support its global development and commercialization plans.
While other pharmaceutical companies are reportedly interested in acquiring Revolution Medicines, there have been market rumors suggesting AbbVie Inc. (NYSE: ABBV) as a potential bidder, although AbbVie has publicly denied such discussions.
The stock performance of Revolution Medicines reflects notable positive momentum, underpinning investor confidence with favorable trends observed across short-, medium-, and long-term periods, as per market analytics.
Neither Merck nor Revolution Medicines has issued an official comment regarding the acquisition talks. Updates will be provided pending any further developments or confirmations from the involved parties.