Merck makes a big bet on rare Ror1 play

Very few projects targeting Ror1 have made it into the clinic, yet Merck & Co has apparently seen enough to persuade it to pay $2.8bn for a part of this nascent oncology space. Velosbio is one of only three companies with an antibody-based project targeting Ror1 in the clinic, according to clinicaltrials.gov, so perhaps scarcity value explains the price tag. Imminent Ash data were presumably another trigger: Velosbio is poised to present results from a phase I trial that generated five complete responses among 20 heavily pretreated lymphoma patients. The private biotech has a pipeline of preclinical antibody-drug conjugates and bispecifics that also target this protein. The takeout represents a huge payday for Velosbio’s backers, who have pumped around $200m into the company over the past couple of years, most recently in a $137m series B that could well have signalled an imminent move onto the stock market. Interestingly, just five days ago a separate Ror1-targeting ADC, Legochem's LCB71, was licensed to Cstone for just $10m. Given the substantial support that equity investors continue to display for young biotechs, perhaps Merck thought it was best to move early, though Velosbio's price suggests that there were other bidders.