Cidara Therapeutics Nabs $9.2 Billion Merck Takeover; Shares Double

Cidara Therapeutics (CDTX) shares doubled, and then some, on Friday after Merck (MRK) agreed to buy the biotech company for $9.2 billion.

The deal is “nothing to sneeze at,” RBC Capital Markets analyst Brian Abrahams said in a report. It values Cidara stock at $221.50 per share, representing a roughly 110% premium to the stock’s closing price on Thursday.

Cidara is testing a long-acting antiviral to protect again the flu called CD388.

“We had viewed CDTX’s CD388 flu prevention program as a particularly attractive fit for potential strategies given the impressive ph. II data and the $3.8B opportunity we estimated, especially after the registrational ph. III program was announced with a design that could potentially address a broader population than had been previously anticipated,” Abrahams said.

In midday trades, Cidara Therapeutics stock skyrocketed 105.4%, closing at 217.71. Merck stock closed roughly flat.

Could More Bidders Emerge?

Abrahams sees Cidara as having considerably more upside than where it’s trading today. Shares of Cidara Therapeutics had already catapulted more than 294% this year, as of Thursday’s close. The stock has a best-possible IBD Digital Relative Strength Rating of 99. This means Cidara shares rank in the leading 1% of all stocks when it comes to 12-month performance.

Merck is a “sensible strategic fit,” Abrahams said. The company has a growing portfolio of potential infectious diseases treatments and is working to offset the upcoming patent expiration for Keytruda. Keytruda, a cancer drug, is Merck’s biggest moneymaker. In the third quarter, it accounted for nearly half of Merck’s total sales at $8.14 billion.

Though there aren’t any obvious antitrust issues, reports have suggested the bidding process could have been competitive. And that wouldn’t be a first for biotech in 2025. Pfizer (PFE) recently won out in a fight against Novo Nordisk (NVO) to buy Metsera. On Friday, Lundbeck put down a bigger bid for Avadel Pharmaceuticals (AVDL), putting initial acquirer Alkermes (ALKS) in the hot seat.

“We could see additional companies for which CTDX could be an attractive strategic fit (noting Sanofi (SNY) has a flu vaccine franchise and Johnson & Johnson (JNJ) had previously been involved in ‘338’s), and we have seen recent competitive bids for a biotech play out publicly,” he said.

Follow Allison Gatlin on X/Twitter at @AGatlin_IBD.

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