MSD said to have pulled back from Revolution Meds deal

Negotiations between MSD and Revolution Medicines over a possible takeover – estimated to have been potentially worth up to $30 billion – have reportedly ended without agreement.

That is according to the Wall Street Journal, which has said MSD failed to reach an agreement with Revolution on a fair price for the business, which has a cancer-focused pipeline headed by daraxonrasib (RMC-6236), a pan-RAS(on) inhibitor in registration trials for pancreatic ductal adenocarcinoma (PDAC), and non-small cell lung cancer (NSCLC).

Rumours of MSD's interest in Revolution first emerged earlier this month in an article by the Financial Times and have led to a strengthening of its share price, up nearly 50% since the start of the year and swelling the company's valuation from around $16 billion to almost $22.75 billion. The stock had surrendered some of those gains in after-hours trading this morning, however, falling 22%.

The WSJ, citing sources close to the matter, suggested that talks between MSD (known as Merck & Co in the US and Canada) and Revolution could resume as the biotech prepares for key clinical trial readouts in the first half of this year, while other interested parties could emerge. Previously, Revolution had been linked to a potential takeover by AbbVie, although, that rumour was dismissed.

If it went through at the supposed price tag, an MSD acquisition of Revolution would be the biggest pharma merger since Pfizer's acquisition of Seagen for $43 billion in 2023.

Discussion about a possible deal announcement was doing the rounds ahead of the JP Morgan Healthcare Conference, which ran earlier this month and is often where big biopharma acquisitions emerge, but this year's event passed without any major announcements.

The biotech's lofty valuation stems from its lead in the pan-RAS category, which is fairly crowded with around a dozen candidates at various stages of clinical testing, and a pipeline of follow-up candidates.

Those include KRAS G12C inhibitor elironrasib (RMC-6291) – which would be a potential rival to Amgen's Lumakras (sotorasib) and Bristol Myers Squibb's Krazati (adagrasib) – and KRAS G12D inhibitor zoldonrasib (RMC-9805), which are in early clinical development.

A fourth candidate codenamed RMC-5127, which acts as a RAS(ON) G12V-selective inhibitor, is due to start human testing later this quarter. When rumours of MSD's interest first emerged, analysts at Mizuho were predicting that Revolution's KRAS franchise could achieve $10 billion in risk-adjusted sales by 2035.

MSD is one of many drugmakers facing patent expirations for blockbuster products, and has been working to build up its pipeline as cancer therapy Keytruda (pembrolizumab) – which accounts for more than half of its sales – starts to lose market exclusivity in 2028.

At the JPM 2026 meeting, MSD chief executive Rob Davis said the company was looking at 'value-adding transactions' at around $15 billion, but was prepared to go higher for the right assets.

Image by Gundula Vogel from Pixabay