Revolution Medicines Shares Plunge 17% After Merck Acquisition Talks Stall
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1d ago
0mins
Source: Fool
- Acquisition Talks Halted: The Wall Street Journal reported that Merck's discussions with Revolution Medicines regarding a potential acquisition stalled due to price disagreements, leading to a nearly 17% drop in Revolution's share price, reflecting investor disappointment over the halted negotiations.
- Overblown Market Reaction: Despite Merck's withdrawal, Revolution's leading drug candidate, daraxonrasib, is in Phase 3 trials for treating pancreatic and non-small cell lung cancers, suggesting that the market may be overreacting to the news given the drug's potential value.
- Interest from Multiple Buyers: Besides Merck, other pharmaceutical companies like AbbVie were also reported to be interested in acquiring Revolution, although AbbVie has since denied pursuing the company, indicating that Revolution remains a sought-after asset that could attract other suitors.
- Optimistic Industry Outlook: Revolution Medicines specializes in oncology drug development, a hot segment in the pharmaceutical industry, and despite the current stock decline, its future market potential and attractiveness remain strong, likely leading to a handsome premium if a suitable buyer emerges.
Analyst Views on RVMD
Wall Street analysts forecast RVMD stock price to fall over the next 12 months. According to Wall Street analysts, the average 1-year price target for RVMD is 86.00 USD with a low forecast of 67.00 USD and a high forecast of 147.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
20 Analyst Rating
20 Buy
0 Hold
0 Sell
Strong Buy
Current: 97.780
Low
67.00
Averages
86.00
High
147.00
Current: 97.780
Low
67.00
Averages
86.00
High
147.00
About RVMD
Revolution Medicines, Inc. is a clinical-stage oncology company developing novel targeted therapies for RAS-addicted cancers. The Company’s research and development pipeline comprises RAS(ON) inhibitors that bind directly to RAS variants, which it refers to as RAS(ON) Inhibitors, and RAS companion inhibitors that target key nodes in the RAS pathway or associated pathways, which it refers to as RAS Companion Inhibitors. Its RAS(ON) Inhibitors are designed to be used as monotherapy, in combination with other RAS(ON) Inhibitors and/or in combination with RAS Companion Inhibitors or other therapeutic agents. The company’s RAS(ON) inhibitors are daraxonrasib (RMC-6236), an RAS(ON) multi-selective inhibitor; elironrasib (RMC-6291), an RAS(ON) G12C-selective inhibitor; and zoldonrasib (RMC-9805), a RAS(ON) G12D-selective inhibitor, are in clinical development. The Company’s pipeline also focuses on RAS(ON) mutant-selective inhibitors, including RMC-0708 (Q61H) and RMC-8839 (G13C).
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
