I read that article and there has been a lot said about Merck and Keytruda. As anyone paying attention has discerned, Merck has been doing a Keytruda combination trial with Seagen (formerly Seattle Genetics) and appears to be on the verge of acquiring Seagen for ~$40B. While they still have the funds to do more, the real challenge for Merck's management is about effectively integrating any new acquisition. Ineffective integration is one of the main reasons M&A’s fail. Given the amount of money and the potential for extending the patent for Keytruda, I do not think management at Merck will want to complicate matters more than necessary. Does that mean they would not be in the running for Series C as a JV partner with NWBO? Perhaps! But...
Better said, would NWBO want to partner with Merck at the risk they might lose their enthusiasm during the JV or would NWBO be better served by another partner, one that has long had a therapeutic focus on cancer? One that is seeing its market share shrink. Who might that be?
The #1 producer of cancer drugs is Roche with more than $27B in annual sales and it has made cancer its focus in an effort to develop new and innovative cancer drugs, as well as expand the possible label indications for its existing drugs. In fact, four of Roche's top-five selling pharmaceutical products are geared at fighting cancer. These include Rituxan for non-Hodgkin's lymphoma (~$8.1 billion), Avastin, which can be used for colorectal, breast, kidney, lung, and a host of other cancer types (~$7.3 billion), Herceptin, a commonly-used therapy to treat HER2-positive breast cancer (~$7.1 billion), and Xeloda for colorectal, colon, or breast cancer (~$1.8 billion).
Roche has dominated the cancer landscape for years, BUT (here is the compelling point) it is about to get a lot less commanding. Roche is projected to see its market share drop to 11.9% from its current 26.4%, as six of its top 10 competitors – J&J, Pfizer, AstraZeneca, Merck & Co., AbbVie and Astellas – grow sales by double digits.
If I were on the NWBO management team, I would be talking to Roche.
