Merck to Buy Idenix for $3.85 Billion -- 3rd Update

By Erin McCarthy 

Merck & Co. agreed to buy Idenix Pharmaceuticals Inc. in a bid to expand its portfolio of hepatitis C treatments.

The pharmaceutical company said it would acquire Idenix for $24.50 per share in cash, more than three times Idenix's closing price Friday.

The move comes just weeks after Merck agreed to sell its consumer-product business, which includes over-the-counter products like Claritin allergy medicines and Coppertone sunscreens, to Bayer AG for $14.2 billion.

The global pharmaceutical industry has seen a wave of mergers and acquisitions lately as drug companies seek to focus more on areas where they have more expertise and scale.

Idenix is a biopharmaceutical company that focuses on developing treatments for human viral diseases, including hepatitis C. The company currently has three hepatitis C drug candidates in clinical development, the companies said. It has no products on the market.

"Idenix's investigational hepatitis C candidates complement our promising therapies in development" and will help to develop a highly effective, once-daily, all-oral treatment, said Dr. Roger Perlmutter, president of Merck Research Laboratories.

Merck has several hepatitis C medicines in development, including one that has received breakthrough therapy designation from the U.S. Food and Drug Administration, the company said.

Hepatitis C therapies have become a hot area as a new generation of products promise to cure more patients in shorter treatment times and with fewer side effects than older therapies.

A drug from Gilead Sciences Inc., called Sovaldi, is the first of this new generation and reported nearly $2.3 billion in first-quarter sales in what is believed to be the best-selling prescription drug launch in history. The drug has drawn criticism for its high price tag of $1,000 per pill, or $84,000 per patient for a standard 12-week treatment.

Spending on specialty drugs, including treatments for hepatitis C, are expected to surge in the next two years, according to an April report from Express Scripts. It had forecast the U.S. will spend 1,800% more on hepatitis C medications in 2016 than it did in 2013.

The Merck-Idenix deal, which has been approved by both companies' boards, is expected to close in the third quarter.

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