Merck is nearing a roughly $10bn deal to buy lung disease-focused biotech Verona Pharma, the US drugmaker’s biggest acquisition in two years as it expands in respiratory medicine.

The acquisition of Verona would enhance the New Jersey-based pharmaceutical company’s pipeline with the addition of Ohtuvayre, a medicine approved in the US to treat chronic obstructive pulmonary disease (COPD), which analysts predict could generate peak annual sales of nearly $4bn by the mid-2030s. The drug is also in trials as a potential treatment for other lung conditions.  

The acquisition, which would be Merck’s largest since its $10.8bn takeover of Prometheus Biosciences in 2023, is the latest example of a pharmaceutical group targeting a biotech with an approved product already generating revenue to fill the gap left by blockbuster drugs coming off patent.