Merck licenses Evaxion’s AI-discovered vaccine in $592M deal

Merck & Co. is licensing a preclinical vaccine candidate, EVX-B3, from Denmark-based Evaxion Biotech for up to $592 million in milestone payments, starting with a $7.5 million upfront.

Why it matters: The deal validates the use of AI in vaccine discovery and gives Merck full control over a novel vaccine targeting a serious, untreatable infectious disease.

Backstory: Merck is continuing its pattern of working with Evaxion that began in 2023 after Merck’s venture arm led a financing round for the company in 2023. The EVX-B3 candidate was co-developed by Merck and Evaxion using the latter´s AI-Immunology platform. Their broader $1 billion agreement from 2024 gave Merck options to license two early-stage candidates. According to the companies, EVX-B3 targets a pathogen causing frequent infections and serious complications, with no current vaccine available.

Yes, but: There is some mystery that goes along with the enthusiasm, as EVX-B3’s exact target remains undisclosed. What we do know is that the vaccine is described as addressing a high-incidence, hard-to-treat global pathogen.

Zoom in: Merck puts its money on the table to support Evaxion, as the company still holds an option on a second Evaxion vaccine, EVX-B2, targeting gonorrhea. If exercised, it would bring another $2.5M upfront and up to $592M in milestones.

Big picture: The deal reflects Big Pharma’s growing reliance on AI platforms for early-stage R&D while highlighting the continued investment in infectious disease vaccines, even amid regulatory scrutiny and shifting vaccine policies post-COVID.