Here is why Checkmate shares surged 300%

Checkmate Pharmaceuticals Inc. (NASDAQ: CMPI) shares are up 300% after the clinical-stage company focusing on novel tech harnessing the immune system's power in the fight against cancer announced a definitive agreement to be acquired by Regeneron Pharmaceuticals Inc. (NASDAQ: REGN). Regeneron will acquire Checkmate's common shares for $10.5 per share for almost $250 million.

Checkmate’s vidutolimod is a TLR9 experimental product

Currently, Checkmate's lead experimental product is vidutolimod, an advanced generation CpG-A oligodeoxynucleotide Toll-like receptor 9 (TLR9) agonist administered in a virus-like particle.

Vidutolimod is an experimental therapy that is yet to receive US FDA approval or any other regulatory body. It is a monotherapy that is injected into the tumor area and is thought to activate and grow anti-tumor T cells and promote tumor shrinkage in patients whose cancers had previously advanced on PD-1 checkpoint suppression.

The acquisition of Checkmate will add a new promising modality to Regeneron's pipeline of potential cancer-treating approaches as the company expands and advances its research initiatives in immune-oncology

CEO Regeneron Leonard Schleifer said:

The agreement allows Regeneration to launch a bid to purchase Checkmate

The merger contract allows Regeneron to launch a bid to buy all of Checkmate's shares outstanding via a subsidiary. The takeover bid will be subject to numerous requirements, including the offer for a majority of Checkmate's common stock. Checkmate CEO and President Alan Bash said:

Art Krieg, the founder and Chief Scientific Officer of Checkmate, commented: