Capital and pipeline dual anchoring Sac-TMT has become the "ballast stone" of Merck & Co., Inc.'s (MRK.US) global pipeline.

On November 4th, Merck & Co., Inc. (MRK.US) announced that it has reached a $700 million research and development funding agreement with Blackstone. The funding will be used for the global development of the core ADC asset sac-TMT. As the ADC field becomes a new focus for global pharmaceutical innovation, the collaboration between multinational pharmaceutical companies and capital giants for specific development not only signifies high recognition of the commercial value of sac-TMT, but also indicates that Chinese innovative drugs are accelerating their impact on the global heavyweight drug camp through the dual drivers of "global research and development + capital empowerment". Strategic positioning: Pipeline restructuring of Merck & Co., Inc. Caroline Litchfield, CFO of Merck & Co., Inc., stated that this agreement will help the company fully explore the potential of sac-TMT while continuing to advance a broad deployment. This will not only benefit patients and revenue growth but also maintain the company's strong financial position. With the patent cliff of Keytruda looming, Merck & Co., Inc.'s layout of ADC drugs is becoming more determined. In this context, the excellent clinical data of sac-TMT and its synergistic potential with Keytruda accurately match Merck & Co., Inc.'s strategic gap. The cooperation between the two parties began in 2022, with Merck & Co., Inc. obtaining collaboration authorization for sac-TMT and other ADC drugs, with a total transaction amount exceeding $10 billion, setting a record for China's innovative drugs going global in that year. Currently, Merck & Co., Inc. has conducted 15 global Phase III clinical studies around sac-TMT in multiple areas such as lung cancer, breast cancer, gastric cancer, and gynecological tumors. According to the agreement, Blackstone will pay $700 million to Merck & Co., Inc., specifically to fund part of the development costs expected to be generated by sac-TMT in 2026. Capital increase: Value recognition of Blackstone's $700 million entry In terms of cooperation details, Merck & Co., Inc. will exchange a certain right to future income from sac-TMT for this financing. Blackstone's almost "pure funding support" mode not only guarantees the control of the product by the licensee but also injects ample funds into the research and development process. As a top global private equity firm, Blackstone has assisted in the listing of over 200 drugs with its clinical and commercial experience. Its previous projects including the Moderna flu vaccine and Alnylam cardiovascular drugs have achieved high value landings. This $700 million investment in sac-TMT is due to its competitive advantage in clinical data and broad market prospects. Commercial acceleration: Value realization from clinical to market The commercial potential of sac-TMT has gradually been released through clinical validation and market feedback - its commercialization in China has entered a phase of rapid growth, with the half-year report for 2025 showing revenue exceeding 300 million during the reporting period; and at the recent ESMO conference, sac-TMT won two LBA awards (including one heavyweight chairman forum report) and five posters, making it one of the domestic innovative drugs with the highest number of heavyweight reports. Currently, Merck & Co., Inc. clearly lists it as a "candidate product with heavyweight bomb potential", and according to the plan, the product will start to disclose data from multiple global Phase III clinical trials from 2027. From Merck & Co., Inc.'s strategic positioning to Blackstone's $700 million support, sac-TMT is becoming a benchmark for the internationalization of Chinese innovative drugs. This ADC drug, which embodies the research strength of Kintor Pharmaceutical (06990) and the strategic expectations of Merck & Co., Inc., is expected to fill the therapeutic gap in the global oncology field soon.