Merck deal for Prometheus a ‘strategic positive,’ says BofA

After Merck (MRK) announced plans to acquire Prometheus Biosciences (RXDX), a clinical stage biotech pursuing a precision medicine approach for the treatment of immune-mediated diseases, for $10.8B in cash, BofA analyst Geoff Meacham said the firm wouldn’t expect the proposed transaction to "meaningfully move Merck’s shares on Monday given its relative size." However, the firm calls the deal "a strategic positive and another step in the right direction to diversify Keytruda concentration risk. BofA, which says Merck continues to deliver strong commercial performance from the core business and has made "solid progress" to address Keytruda’s loss of exclusivity, maintains a Buy rating and $130 price target on Merck shares.