Pharmaceutical research giant Merck & Co. has entered into a definitive agreement under which the Whitehouse Station, N.J.-based firm will acquire San Diego-based cardiology drug development firm NovaCardia. Under terms of the agreement, Merck will acquire all of the outstanding equity of NovaCardia for $350 million plus the amount of cash on hand at the time of closing, of which will be paid in Merck stock based on the average closing stock price on the five days prior to closing of the acquisition.

NovaCardia’s lead product candidate is KW-3902, an adenosine A1 receptor antagonist. The compound is being studied in Phase 3 clinical trials in patients with acute congestive heart failure (CHF). KW-3902 is believed to block adenosine-mediated constriction of blood flow to the kidneys and inhibit reabsorption of salt and water by the kidney, thereby increasing urine volume and maintaining renal function in patients with CHF, Merck said.

The acquisition is subject to clearance under the U.S. Hart-Scott-Rodino Antitrust Improvements Act and other customary conditions. The two companies said they expect to close the acquisition within 45 days.