September 6, 2017 / 5:03 PM / a year ago

Merck & Co snaps up three year-old German biotech firm for up to $550 million

FRANKFURT (Reuters) - U.S. pharma group Merck & Co (MRK.N) has acquired 3-1/2 year old German biotech start-up Rigontec for up to 464 million euros ($554 million), adding a new approach to its development of drugs that spur the immune system to attack tumors.

FILE PHOTO: FILE PHOTO: The logo of Merck is pictured in this illustration photograph in Cardiff, California, U.S., April 26, 2016. REUTERS/Mike Blake/File Photo

Merck, maker of promising cancer immunotherapy Keytruda, agreed to pay 115 million euros upfront for the Munich-based firm and up to 349 million euros on top, depending on regulatory and commercial achievements, the two companies said in a statement on Wednesday.

Rigontec just started testing its most advanced compound RGT100 on humans in May, banking on a mechanism of action called RIG-I which is designed to trigger a long-term response of the innate immune system, the body’s first line of defense against infections.

Rival Bristol-Myers Squibb Co (BMY.N) last month banked on a similar medical approach when it agreed to buy IFM Therapeutics for an upfront payment of $300 million.

Rigontec was founded in early 2014 as a spin-off of the University of Bonn and has raised close to 30 million euros from a number of life science investors.

Reporting by Ludwig Burger, editing by Louise Heavens

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