Merck’s $11.5bn Acceleron Buy Partially Fills Future Keytruda Revenue Gap

At first glance, Merck & Co., Inc.’s $11.5bn acquisition of Acceleron Pharma, Inc. with a commercial drug and a late-stage candidate seen as a potential blockbuster seems like a good deal for a company looking to diversify its revenue. However, Acceleron recognizes only a portion of sales from its sole commercial product Reblozyl (luspatercept) from partner Bristol Myers Squibb Company and will have to pay BMS royalties on sales of the Phase III pulmonary arterial hypertension (PAH) drug sotatercept.

Some analysts cheered the all-cash transaction announced on 30 September and slated to close in the fourth quarter of this year. Others noted that royalties from Reblozyl and $2bn-plus in anticipated sotatercept revenue will fill only a fraction of the potential revenue gap when Merck’s top-selling product Keytruda (pembrolizumab) – with $14