The Irish firm will also make additional, undisclosed, payments to Meritage based on the achievement of drug development and regulatory milestones.
Shire Research and Development head Philip Vickers said: "Shire’s pipeline and strategic focus on rare diseases is further strengthened with the acquisition of Meritage, which also complements our strong GI capabilities.
"Adding this Phase III-ready compound to our late-stage portfolio will allow us to leverage our expertise to further develop this important therapy that, if approved, will give hope to patients living with eosinophilic esophagitis."
The Irish firm secured rights to buy Meritage in connection with its $4.2bn acquisition of rare disease specialist ViroPharma in 2014.
As part of the deal, Shire has acquired the global rights as well as further development of Meritage’s Phase III-ready compound, Oral Budesonide Suspension (OBS).
Meritage’s OBS is designed to treat adolescents and adults with eosinophilic esophagitis (EoE), a rare, chronic inflammatory gastrointestinal (GI) disease. EoE is characterized by inflammation and accumulation of a specific type of immune cell, called an eosinophil, in the esophagus.
The US Food and Drug Administration (FDA) had already granted orphan drug status to OBS to treat EoE patients.
Image: Shire location in Lexington Massachusetts. Photo: courtesy of John Phelan.