Merck's $10B Acquisition of Verona Pharma Boosts Respiratory Portfolio with COPD Drug Ohtuvayre

Merck & Co. has announced a $10 billion acquisition of Verona Pharma, securing the promising chronic obstructive pulmonary disease (COPD) drug Ohtuvayre. The deal, expected to close in the fourth quarter of 2025, marks a significant expansion of Merck's respiratory portfolio and represents one of the largest biopharma acquisitions of the year.

Ohtuvayre: A Novel COPD Treatment

Ohtuvayre, approved by the FDA in June 2024, is the first new inhaled COPD treatment in over two decades. As a dual inhibitor of phosphodiesterase 3 (PDE3) and phosphodiesterase 4 (PDE4) enzymes, it offers a unique combination of bronchodilator and anti-inflammatory effects.

The drug has shown strong market performance since its launch in August 2024, with first-quarter 2025 sales reaching $71 million. Analysts project peak annual sales potential of $3.4 to $4 billion, positioning Ohtuvayre as a potential blockbuster in the growing COPD market.

Strategic Implications for Merck

This acquisition aligns with Merck's strategy to offset the anticipated revenue loss from its top-selling cancer drug Keytruda, which faces patent expiration later this decade. Merck CEO Rob Davis emphasized the company's focus on deals in the $10 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 deal follows Merck's recent pattern of major acquisitions, including the $11.5 billion purchase of Acceleron in 2021 and the $10.8 billion acquisition of Prometheus Biosciences in 2023. These moves are part of Merck's broader plan to launch approximately 20 new growth drivers in the coming years, most with blockbuster potential.

Patent Considerations and Market Outlook

While Ohtuvayre's main composition patent expired in 2020, Merck remains confident in its ability to protect the drug's market exclusivity. The company cites formulation patents, particularly one covering a specific polymorph structure crucial for the drug's stability, as key to maintaining protection until the mid-2030s.

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. With Ohtuvayre's unique mechanism of action and Merck's extensive commercial resources, the company is well-positioned to capitalize on this expanding market.

As the pharmaceutical landscape continues to evolve, Merck's acquisition of Verona Pharma and Ohtuvayre represents a strategic move to strengthen its position in the respiratory space and ensure continued growth in the face of future patent expirations.