Merck & Co. is buying Cubist Pharmaceuticals Inc. for US$8.4 billion in cash, boosting its arsenal to fight drug-resistant bacteria.
Merck is offering US$102 per share for Cubist, Bloomberg reported Tuesday, citing a statement by the companies.
The price is 37 percent above Cubist’s Dec. 5 close, valuing the deal at US$9.5 billion including debt.
Chief executive Ken Frazier said the deal will add to Merck’s line of drugs used in hospitals, one of four areas of strategic focus the drug maker announced last year.
“We will continue to look at our portfolio to bolster those areas where we can have leadership and market growth and to divest those things that have better opportunities outside our business,” Frazier said.
Cubist has said it plans to introduce four new drugs by 2020 to combat bacterial infections that are resistant to other treatments because of overuse.
The rising threat of drug-resistant bugs has spurred public health authorities to urge companies to invest in new antibiotics, a field drugmakers had largely abandoned to focus on more profitable therapeutic areas such as cancer or hepatitis C.
Cubist ran a comprehensive tender process and had other bidders, said Robert Perez, Cubist president and chief operating officer, who is scheduled to become chief executive on Jan. 1.
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