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In a move set to reshape cancer drug financing, Merck & Co. announced Tuesday that it will receive $700 million from Blackstone Life Sciences to accelerate development of sacituzumab tirumotecan, an experimental antibody-drug conjugate (ADC) targeting TROP2, a protein prevalent in multiple aggressive cancers.

The landmark collaboration marks a growing intersection between private equity and biopharma innovation, as Merck taps external funding to advance one of its most promising oncology candidates.

High-Stakes Bet on TROP2

Under the agreement, Blackstone, the life-sciences investment arm of private equity titan Blackstone Inc., will earn “low-to-mid single-digit” royalties on global sales of sac-TMT—but only if the therapy secures U.S. Food and Drug Administration (FDA) approval for first-line treatment of triple-negative breast cancer, one of the most lethal and treatment-resistant forms of the disease.

The financing will cover a significant portion of development costs through 2026, according to Merck’s announcement.

“This agreement positions Merck to harness the potential of sac-TMT, a promising ADC candidate targeting TROP2,” said Caroline Litchfield, Merck’s chief financial officer. “We are making critical investments that drive both patient impact and revenue growth while maintaining financial discipline.”

Full Control, Shared Vision

Despite Blackstone’s financial backing, Merck retains full ownership and control over sac-TMT, including its global development and commercialization rights outside Greater China.

“Sac-TMT is an innovative asset with the potential to transform patient care across multiple tumor types,” said Dr. Nicholas Galakatos, global head of Blackstone Life Sciences. “Our collaboration with Merck is designed to unlock its full clinical and commercial potential, leveraging our scale and expertise to advance this critical therapy.”

A Global Effort Against Cancer

Originally developed by China’s Kelun-Biotech, sac-TMT is currently being tested in 15 Phase 3 trials targeting six cancer types, including breast, endometrial, and lung cancers. The therapy builds on Merck’s expanding portfolio of antibody-drug conjugates, an area increasingly viewed as the next frontier in oncology for their ability to deliver precision-guided chemotherapy with reduced toxicity.

Biopharma’s Funding Evolution

The deal reflects a rising trend in biotech financing, as pharmaceutical giants increasingly turn to private equity investors to share the financial burden and risks of late-stage drug development.

Merck, already one of the world’s most active dealmakers in the pharmaceutical sector, has made a string of major acquisitions in recent months. In July, the company struck a $10 billion deal to acquire Verona Pharma PLC, a specialist in respiratory diseases—one of Merck’s largest purchases to date.

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