Merck's $10B Acquisition of Verona Pharma Reshapes COPD Landscape

In a significant move that underscores the ongoing consolidation in the pharmaceutical industry, Merck & Co. has announced its acquisition of London-based Verona Pharma for $10 billion. The deal, which is expected to close in the fourth quarter of 2025, centers around Verona's promising chronic obstructive pulmonary disease (COPD) drug, Ohtuvayre.

Ohtuvayre: A Game-Changer in COPD Treatment

Ohtuvayre, approved by the FDA in June 2024, represents the first novel inhaled treatment for COPD in over two decades. As a selective dual inhibitor of phosphodiesterase 3 (PDE3) and phosphodiesterase 4 (PDE4) enzymes, Ohtuvayre combines bronchodilator and non-steroidal anti-inflammatory effects in a single medicine.

The drug has shown impressive early market performance, with $71 million in sales during the first quarter of 2025 and approximately 25,000 prescriptions filled. Analysts at Jefferies have projected peak sales estimates of up to $4 billion, highlighting the potential impact of this acquisition on Merck's portfolio.

Strategic Implications for Merck

This acquisition aligns with Merck's strategy to bolster its pipeline ahead of the patent expiration of its blockbuster cancer drug, Keytruda, later this decade. Keytruda generated $29.5 billion in sales in 2024, accounting for 46% of Merck's revenue.

Merck CEO Rob Davis emphasized the company's focus on acquisitions in the $10 billion to $15 billion range, stating, "The sweet spot we see is that $1 to $15-billion range. As we've also consistently indicated, we're willing to go beyond that for the right opportunity."

The Verona acquisition follows Merck's recent pattern of significant biennial transactions, including the $11.5 billion purchase of Acceleron in 2021 and the $10.8 billion acquisition of Prometheus Biosciences in 2023.

Competitive Landscape in COPD Treatment

Merck's acquisition of Verona and Ohtuvayre comes amid increased activity in the COPD treatment space. Other recent developments include:

• GSK's FDA approval for Nucala as an add-on maintenance treatment for adults with inadequately controlled COPD and an eosinophilic phenotype.
• Amgen and AstraZeneca's exploration of their asthma drug Tezspire as a potential COPD treatment.
• Regeneron and Sanofi's approval for Dupixent to treat COPD exacerbations, with ongoing phase 3 trials for their IL-33 inhibitor itepekimab.

The COPD market is expected to grow from $17 billion in 2025 to $27 billion by 2032, according to Merck's human health president Jannie Oosthuizen. This growth potential, combined with Merck's existing commercial infrastructure, positions the company to potentially accelerate Ohtuvayre's market penetration and reach more COPD patients.