Irish pharmaceutical firm Open Orphan has agreed to a merger deal with British firm hVIVO, which would create a group valued at around £30m.

As the offer is classified as a reverse takeover, it will require the approval of shareholders in Open Orphan.

UK based hVIVO provides services to viral challenge studies and laboratories.

Set up in 2017, Open Orphan is building a European rare/orphan disease focused pharma services company.

Earlier this year, Open Orphan bought AIM-listed Venn Life Sciences, an integrated drug development consultancy.

The company said the deal offers a number of key strategic benefits for Open Orphan and will deliver significant immediate synergies as it continues on its growth trajectory. 

"The combination will also deepen Open Orphan's client base unlocking significant cross selling opportunities which should accelerate growth significantly," it added.

Cathal Friel, CEO of Open Orphan, said the merger of Open Orphan and hVIVO is a key milestone in the execution of the company's strategy to become a larger-scale specialist pharma services business and in complementary segments where specialist skills and know-how command higher margins.

"The merger allows the combined business to maximise shareholder value through delivering cost and revenue synergies across the businesses and one that is better positioned to consistently capture greater market share as part of a properly profitable business with losses confined to the past," Mr Friel added.