Verona Pharma stock jumps 20% on $10B Merck deal—can FDA-approved Ohtuvayre reshape COPD care?
What is Ohtuvayre and why does it matter?
Live Events
How much is Merck paying and what does it mean for shareholders?
What's next for Verona Pharma and its future under Merck?
What does this mean for the future of COPD treatment?
FAQs:
(You can now subscribe to our
(You can now subscribe to our Economic Times WhatsApp channel
Verona Pharma stock surged 20% on Wednesday after Merck announced it's buying the British biotech company in a $10.8 billion deal. Merck, through a subsidiary, will pay $107 per American depositary share for Verona Pharma, a company focused on respiratory treatments. This move follows the FDA's recent approval of Verona's drug Ohtuvayre, which is used to manage chronic obstructive pulmonary disease (COPD) in adults.As per the joint announcement, the deal is expected to close in Q4 2025, pending regulatory approval from the U.K. authorities. Meanwhile, Verona's U.S.-listed shares were up 20% at $104.55 in premarket trading, while Merck's stock was slightly higher, rising 0.2%.Merck's decision to acquire Verona Pharma comes just weeks after the U.S. Food and Drug Administration (FDA) granted approval to Ohtuvayre, Verona's lead drug for COPD. Merck CEO Robert M. Davis called Ohtuvayre a strong fit for the company's growing cardio-pulmonary portfolio, saying the drug "complements and expands" Merck's existing treatments.This acquisition allows Merck to strengthen its position in respiratory care, a space it's been eyeing for future growth. With Ohtuvayre already FDA-approved and additional clinical trials underway, Merck likely saw this as a well-timed opportunity to buy into a promising treatment pipeline.Ohtuvayre, Verona Pharma's flagship therapy, is designed for the maintenance treatment of chronic obstructive pulmonary disease (COPD)—a condition that affects over 16 million adults in the U.S. alone, according to the CDC.The drug received FDA approval in June 2024, and it is now being evaluated for additional use in non-cystic fibrosis bronchiectasis, which is another hard-to-treat lung condition. This broader application potential makes Ohtuvayre a valuable long-term asset, not just a single-treatment drug.Given the increasing number of COPD cases and limited long-term therapies in the market, Ohtuvayre could be a key differentiator for Merck in this niche.The deal values Verona Pharma at approximately $10.8 billion, with Merck agreeing to pay $107 per American depositary share (ADS). This represents a ~24% premium over Verona's recent trading price before the announcement.Shareholders of Verona saw an immediate benefit, with stock climbing 20% to $104.55 in early trading hours. The offer price also gives current holders an attractive exit or long-term upside if they believe in Merck's execution capabilities.This acquisition follows a trend of pharma giants turning to biotech startups for fresh innovation rather than developing everything in-house—a strategy that saves time and accelerates go-to-market opportunities.Once the acquisition is finalized—expected sometime in Q4 2025, pending UK regulatory approval—Verona will operate as part of Merck's growing respiratory division. Merck will likely support ongoing trials for Ohtuvayre's use beyond COPD, particularly in non-cystic fibrosis bronchiectasis.Additionally, Merck may integrate Verona's research teams, technologies, and pipelines into its broader global infrastructure to maximize development and commercial potential.This move not only gives Merck access to a revenue-generating asset, but also the scientific expertise and momentum Verona has built around respiratory innovation.This acquisition could mark a turning point in how COPD and related pulmonary diseases are treated. With Merck's global reach and Verona's product innovation, the hope is for more effective, accessible, and scalable treatments.In a market where demand for chronic disease therapies is rising sharply—especially in aging populations—Merck's move positions it well for the long term.As more clinical data becomes available for Ohtuvayre's extended applications, both patients and investors will be watching closely to see how this partnership unfolds.The Verona Pharma stock jump reflects strong investor confidence in Merck's $10B bet on respiratory care. With Ohtuvayre already FDA-approved and more indications under trial, this acquisition could reshape Merck's portfolio—and possibly the future of COPD treatment worldwide.A: Merck bought Verona to expand its COPD drug pipeline with FDA-approved Ohtuvayre.A: Verona develops treatments for COPD and other lung conditions like bronchiectasis.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Hans India
4 minutes ago
- Hans India
Trump tells tech giants to stop hiring, building in India
Washington DC: US President Donald Trump has called for eschewing 'radical globalism' pursued by some of the country's firms, including tech giants like Google, Meta and Microsoft, among others, to 'stop building factories' and 'hiring workers' from countries including India. 'For too long, much of our tech industry pursued a radical globalism that left millions of Americans feeling distrustful and betrayed. And you know that,' Trump said. 'Many of our largest tech companies have reaped the blessings of American freedom while building their factories in China, hiring workers in India, and slashing profits in Ireland. You know that. All the while dismissing and even censoring their fellow citizens right here at home,' Trump said ahead of unveiling his administration's 'AI Action Plan.' Trump signed three new executive orders: expediting permitting for AI infrastructure, boosting exports of US-developed AI, and banning federal procurement of AI systems with political or ideological bias. During his remarks at the AI Summit, Trump urged US tech companies to be 'all in for America.' 'We want you to put America first. You have to do that. That's all we ask. That's all we ask to partner with our tech geniuses and achieving this vision. Today, we're releasing the White House AI action plan. Big stuff,' Trump said. The US President said that in a few months, 'Meta, Amazon, Google, Microsoft are all investing $320 billion dollars or more in data centers and AI infrastructure this year' adding that Nvidia has committed $500 billion over the next four years. 'For decades, we had leaders who spent their time focused on building up foreign nations. Under the Trump administration, we are going to have leaders who are going to build up our nation. This colossal investment in AI infrastructure and many other industries for that matter such as automobiles and so many other things will also create thousands and thousands of great paying jobs. the kind of jobs we want, including lots of blue collar jobs,' Trump said.
Indian Express
4 minutes ago
- Indian Express
Australia set to reduce US beef import restrictions; Trump warns other countries refusing ‘magnificent' meat — ‘on notice'
Australia announced its plan to reduce restrictions on beef imports from the United States on Thursday. While the Trump administration hailed this move as a major victory over 'non-scientific trade barriers', the US President used this as an opportunity to warn other countries that they are 'on notice' if they refuse their 'magnificent' cattle meat. While the country allowed entry of the meat grown in the US since 2019, Australia had banned those sourced from from Canada or Mexico. The restrictions were designed to prevent mad cow disease, also known as bovine spongiform encephalopathy (BSE). 'Australia stands for open and free trade — our cattle industry has significantly benefited from this,' Australian Agriculture Minister Julie Collins said in a statement. The latest plan now will not compromise biosecurity, she added. The timing of the new, reduced restrictions has not been finalised. Australian demand for US beef is expected to remain low for reasons including a relatively weak Australian dollar. Beef prices have also rising in the US due to factors that include drought and shrinking domestic herd numbers, as per news agency AP. Over the last 20 years, the US administration has pushed for the benefits of the beef market access to Australia as part of the US-Australia Free Trade Agreement (FTA). This year marks the 20th anniversary of the bilateral free trade deal. The US has maintained a trade surplus with Australia for decades. The Trump administration recently introduced additional movement controls that identify and trace all cattle from Mexico and Canada — the ones banned by Australia — to their farms of origin. Australian authorities were 'satisfied the strengthened control measures put in place by the US effectively manage biosecurity risks,' Collins said. This comes as producers in Australia fear that the export market would vanish overnight if diseases, including mad cow or foot-and-mouth disease, infected their cattle. Opposition lawmaker David Littleproud suspected the government was endangering Australia's cattle industry to appease Trump, as per news agency AP. The US President, in a in a celebratory post on Truth Social, said that even the two countries are 'great friends', Australia had banned beef from the country. 'After many years Australia has agreed to accept American Beef!… Now, we are going to sell so much to Australia because this is undeniable and irrefutable Proof that US Beef is the Safest and Best in the entire World,' Trump wrote. Acknowledging the US ranchers, he said: 'All of our Nation's Ranchers, who are some of the hardest working and most wonderful people, are smiling today, which means I am smiling too. Let's keep the Hot Streak going. IT'S THE GOLDEN AGE OF AMERICA!' Meanwhile, US Secretary of Agriculture Brooke L Rollins responded to Australia's announcement by congratulating Trump on a 'major trade breakthrough that gives greater access to US beef producers selling to Australia.' 'This is yet another example of the kind of market access the President negotiates to bring America into a new golden age of prosperity, with American agriculture leading the way,' she said in a statement. In the same post, Trump also issued a warning to 'other countries that refuse our magnificent meat'. Earlier during his game of chicken over tariffs, Trump had attacked Australian import restrictions on US beef. 'Australia bans — and they're wonderful people, and wonderful everything — but they ban American beef,' Trump had told reporters when he announced in April that tariffs of at least 10 per cent would be placed on Australian imports, with steel and aluminum facing a 50 per cent tariff. 'Yet we imported $3 billion of Australian beef from them just last year alone. They won't take any of our beef. They don't want it because they don't want it to affect their farmers and, you know, I don't blame them, but we're doing the same thing right now,' he had added. Australian Prime Minister Anthony Albanese and Trump were to hold a one-on-one meeting on the sidelines of a G7 summit in Canada last month. But it did not take place as Trump left early amid the then escalating Iran-Israel conflict situation. The Australian PM is said to be expecting a meet this year, however, there is no confirmation of a date being set. Australia's opposition to any US tariffs will be high on the agenda when Albanese secures his first meet with Trump since coming to power.
The Hindu
4 minutes ago
- The Hindu
Trump's order to block 'woke' AI in government encourages tech giants to censor their chatbots
Tech companies looking to sell their artificial intelligence technology to the federal government must now contend with a new regulatory hurdle: proving their chatbots aren't 'woke.' U.S. President Donald Trump's sweeping new plan to counter China in achieving 'global dominance' in AI promises to cut regulations and cement American values into the AI tools increasingly used at work and home. But one of Mr. Trump's three AI executive orders signed Wednesday — the one 'preventing woke AI in the federal government' — marks the first time the U.S. government has explicitly tried to shape the ideological behaviour of AI. Several leading providers of the AI language models targeted by the order — products like Google's Gemini and Microsoft's Copilot — have so far been silent on Trump's anti-woke directive, which still faces a study period before it gets into official procurement rules. While the tech industry has largely welcomed Mr. Trump's broader AI plans, the anti-woke order forces the industry to leap into a culture war battle — or try their best to quietly avoid it. 'It will have massive influence in the industry right now,' especially as tech companies are already capitulating to other Trump administration directives, said civil rights advocate Alejandra Montoya-Boyer, senior director of The Leadership Conference's Center for Civil Rights and Technology. The move also pushes the tech industry to abandon years of work to combat the pervasive forms of racial and gender bias that studies and real-world examples have shown to be baked into AI systems. 'First off, there's no such thing as woke AI,' Montoya-Boyer said. 'There's AI technology that discriminates and then there's AI technology that actually works for all people.' Molding the behaviours of AI large language models is challenging because of the way they're built and the inherent randomness of what they produce. They've been trained on most of what's on the internet, reflecting the biases of all the people who've posted commentary, edited a Wikipedia entry or shared images online. 'This will be extremely difficult for tech companies to comply with,' said former Biden official Jim Secreto, who was deputy chief of staff to U.S. Secretary of Commerce Gina Raimondo, an architect of many of Biden's AI industry initiatives. 'Large language models reflect the data they're trained on, including all the contradictions and biases in human language.' Tech workers also have a say in how they're designed, from the global workforce of annotators who check their responses to the Silicon Valley engineers who craft the instructions for how they interact with people. Mr. Trump's order targets those 'top-down' efforts at tech companies to incorporate what it calls the 'destructive' ideology of diversity, equity and inclusion into AI models, including 'concepts like critical race theory, transgenderism, unconscious bias, intersectionality, and systemic racism.' The directive has invited comparison to China's heavier-handed efforts to ensure that generative AI tools reflect the core values of the ruling Communist Party. Secreto said the order resembles China's playbook in 'using the power of the state to stamp out what it sees as disfavored viewpoints." The method is different, with China relying on direct regulation by auditing AI models, approving them before they are deployed and requiring them to filter out banned content such as the bloody Tiananmen Square crackdown on pro-democracy protests in 1989. Mr. Trump's order doesn't call for any such filters, relying on tech companies to instead show that their technology is ideologically neutral by disclosing some of the internal policies that guide the chatbots. 'The Trump administration is taking a softer but still coercive route by using federal contracts as leverage,' Secreto said. 'That creates strong pressure for companies to self-censor in order to stay in the government's good graces and keep the money flowing.' The order's call for 'truth-seeking' AI echoes the language of the president's one-time ally and adviser Elon Musk, who has made it the mission of the Grok chatbot made by his company xAI. But whether Grok or its rivals will be favoured under the new policy remains to be seen. Despite a 'rhetorically pointed' introduction laying out the Trump administration's problems with DEI, the actual language of the order's directives shouldn't be hard for tech companies to comply with, said Neil Chilson, a Republican former chief technologist for the Federal Trade Commission. 'It doesn't even prohibit an ideological agenda,' just that any intentional methods to guide the model be disclosed, said Chilson, head of AI policy at the nonprofit Abundance Institute. 'Which is pretty light touch, frankly.' Chilson disputes comparisons to China's cruder modes of AI censorship. 'There is nothing in this order that says that companies have to produce or cannot produce certain types of output,' he said. 'It says developers shall not intentionally encode partisan or ideological judgments.' With their AI tools already widely used in the federal government, tech companies have reacted cautiously. OpenAI on Thursday said it is awaiting more detailed guidance but believes its work to make ChatGPT objective already makes the technology consistent with Mr. Trump's directive. Microsoft, a major supplier of online services to the government, declined to comment. Musk's xAI, through spokesperson Katie Miller, a former Trump official, pointed to a company comment praising Mr. Trump's AI announcements but didn't address the procurement order. xAI recently announced it was awarded a U.S. defence contract for up to $200 million, just days after Grok publicly posted a barrage of antisemitic commentary that praised Adolf Hitler. Anthropic, Google, Meta, and Palantir didn't respond to emailed requests for comment Thursday. The ideas behind the order have bubbled up for more than a year on the podcasts and social media feeds of Mr. Trump's top AI adviser David Sacks and other influential Silicon Valley venture capitalists, many of whom endorsed Trump's presidential campaign last year. Their ire centered on Google's February 2024 release of an AI image-generating tool that produced historically inaccurate images before the tech giant took down and fixed the product. Google later explained that the errors — including generating portraits of Black, Asian and Native American men when asked to show American Founding Fathers — were the result of an overcompensation for technology that, left to its own devices, was prone to favouring lighter-skinned people because of pervasive bias in the systems. Trump allies alleged that Google engineers were hard-coding their own social agenda into the product. 'It's 100% intentional,' said prominent venture capitalist and Trump adviser Marc Andreessen on a podcast in December. 'That's how you get Black George Washington at Google. There's override in the system that basically says, literally, Everybody has to be Black.' Boom. There's squads, large sets of people, at these companies who determine these policies and write them down and encode them into these systems.' Sacks credited a conservative strategist who has fought DEI initiatives at colleges and workplaces for helping to draft the order. 'When they asked me how to define woke,' I said there's only one person to call: Chris Rufo. And now it's law: the federal government will not be buying WokeAI,' Sacks wrote on X. Rufo responded that he helped 'identify DEI ideologies within the operating constitutions of these systems.'
