Episode summary
Merck to Acquire Terns Pharmaceuticals in $6.7 Billion Deal | Bloomberg Intelligence
Bloomberg Intelligence
· · Hosts: Paul Sweeney, Scarlet Fu · Guests: Michelle Davis, Geetha Ranganathan, Diana Rosero Pena, Justin Pridon
Summary
Merck is buying Terns Pharmaceuticals for $6.7 billion, paying $53 a share in cash, to bolster its blood-cancer pipeline as Keytruda approaches patent expiration. Michelle Davis said the logic is pipeline replacement, since analysts think Terns’ unapproved drug could still reach several billion dollars in peak sales if it wins approval. She also noted that Merck’s stock rose on the announcement, suggesting investors want the company to keep pursuing deals.
The media discussion centered on Disney and Netflix using big bets to deepen engagement. The analyst said Disney was blindsided by the collapse of an OpenAI/Sora licensing deal tied to a $1 billion equity investment and access to about 200 Disney characters, even as Josh D'Amaro tries to monetize IP through fandom and partnerships. Netflix, by contrast, is leaning into livestreaming and sports, with the BTS comeback show drawing more than 18 million viewers worldwide and the World Baseball Classic cited as a high-ROI example.
Chewy’s quarterly update showed stronger-than-expected sales guidance and continued scale in autoship, vet services, and private label. The restaurant segment from the BI Farm, Food & Fuel Conference focused on food inflation, menu pricing, and protein as a central demand driver, especially for millennials and health-conscious diners.
Key takeaways
- Merck is paying $6.7 billion for Terns to replace future revenue as Keytruda goes off patent, and the analyst expects more M&A from Merck.
- The analyst said Disney was blindsided by the collapse of a $1 billion OpenAI/Sora arrangement that was meant to deepen fan engagement.
- Netflix is spending about $20 billion on content this year, including a $2 billion increase for live events and sports.
- Chewy’s growth story rests on 84% autoship revenue, expanding vet services, and margin leverage from private label and non-merchandise revenue.
- The restaurant panel said protein is becoming a bigger menu driver as consumers, especially millennials, prioritize health, satisfaction and active lifestyles.
Notable quotes
“It makes a lot of sense that they're doing this because they their bestselling drug Kruda which contributed half of their sales last year $31 billion is also the world's bestselling drug is going off patent”
“the fact that, you know, shares are up means investors are applauding this and they, you know, want Merc to to keep doing stuff like this”
“this falling apart definitely kind of leaves Disney definitely they were blindsided”
“Over 18 million viewers worldwide. And this is again we come back to the basic buzzword with in media right now which is engagement”
“So, it's pretty much you set it up. It's subscription based pretty much. It's so you set it up and every so often you get your goodies at your doorstep”
How the episode opens
Bloomberg Audio Studios, podcasts, radio, news. You're listening to the Bloomberg Intelligence Podcast. Catch us live weekdays at 10 a.m. Eastern on Apple CarPlay and Android Auto with the Bloomberg Business App.
Listen on demand wherever you get your podcasts or watch us live on YouTube. We need to talk about the M&A deal that uh has come out in New York this morning. Merc to buy turns pharmaceuticals for $6.7 billion dollar uh to grow in the blood cancer space.
Michelle Davis is our senior deals reporter here in New York and is covering this story for us. Feel like we should call it M&A Wednesday now because the deals no longer happen on Monday anymore.
You know, it's cuz we have a deal show now. So, of course, that's why they're happening on Wednesday. But, uh yeah, big uh deal for Merc today.
It makes a lot of sense that they're doing this because they their bestselling drug Kruda which contributed half of their sales last year $31 billion is also the world's bestselling drug is going off patent. So they really need to do M&A to replenish their pipeline turns is not its drug is not yet approved. Um but analysts are saying that in a few years assuming it does get approval it could have peak sales of several billion dollars.
And so Merc for for Merc it's a bet that at the end of the decade around the same time that Kru is going off patent they will have this uh drug you know coming in to kind of help fill some of that hole.
Merc what are they saying about their M&A appetite I guess? Um because we you know we joke that the pharmaceutical industry is such a deal heavy industry pharma biotech that kind of thing.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- merck acquisition
- pharma deal
- streaming media
- chewy earnings
- restaurant demand trends
Companies and tickers mentioned
- MRK
- DIS
- NFLX
- CHWY
- Merck
- Terns Pharmaceuticals
- Walt Disney
- Netflix
- Chewy
- Revenue Management Solutions
Watch the episode
Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
More from Bloomberg Intelligence
-
Anthropic’s IPO Is Said to Be About Six Times Oversubscribed | Bloomberg Intelligence -
Instant Reaction: Nvidia CEO Jensen Huang Ousted by Nvidia Board | Bloomberg Intelligence -
Nvidia’s Huang Ousted by Board in Move That Roils AI Economy | Bloomberg Intelligence -
CoreWeave Shares Soar After AI Computing Firm Eases Debt Fears | Bloomberg Intelligence -
Anthropic Targets $1.4 Trillion Valuation in Blockbuster IPO | Bloomberg Intelligence -
Nvidia Probe Into CEO Affair Raises Thorny Questions for AI | Bloomberg Intelligence
Bloomberg Intelligence, this episode and its artwork belong to Bloomberg. Octagon is not affiliated with the show; this page is an independent summary.
