Merck & Co. Inc. (NYSE: MRK) shares jumped on Tuesday after the company announced that it has made deals to develop drugs in the fight against COVID-19. This positive news also has helped to lift the broad markets, with the S&P 500 and Dow Jones industrial average each up about 2% on the day.

First, Merck has entered into a collaboration with Ridgeback Biotherapeutics to develop EIDD-2801, an orally available antiviral candidate currently in early clinical development for the treatment of patients with COVID-19.

Under terms of the agreement, Merck will gain exclusive worldwide rights to develop and commercialize EIDD-2801 and related molecules. Ridgeback Bio will receive an undisclosed upfront payment, specified milestones and a share of the net proceeds of EIDD-2801 and related molecules, if approved. Also, Merck will be responsible for clinical development, regulatory filings and manufacturing.

Second, Merck entered into a collaboration with IAVI to develop an investigational vaccine against SARS-CoV-2 to be used for the prevention of COVID-19. This vaccine candidate will use the recombinant vesicular stomatitis virus (rVSV) technology that is the basis for Merck’s Ebola Zaire virus vaccine, Ervebo, which was the first rVSV vaccine approved for use in humans.

Under the terms of this agreement, IAVI and Merck will work together to advance the development and global clinical evaluation of a SARS-CoV-2 vaccine candidate designed and engineered by IAVI scientists. The vaccine candidate is in preclinical development, and clinical studies are planned to start later in 2020.

Merck will lead regulatory filings globally. Both organizations will work together to develop the vaccine and make it accessible and affordable globally, if approved.

Finally, Merck announced that it would be acquiring Themis. The planned acquisition builds on the ongoing collaboration between the two companies to develop vaccine candidates using the measles virus vector platform, and it is expected to accelerate the development of Themis’s COVID-19 vaccine candidate.

Currently, the vaccine candidate is in preclinical development, and clinical studies are planned to start later in 2020.

Merck stock traded up over 1% Tuesday morning at $77.66, in a 52-week range of $65.25 to $92.64. The consensus price target is $93.94.

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