DURHAM – Drug giant Merck is paying $2.75 billion in cash for a biotech startup, VelosBio, which had landed two investments from Pappas Capital. And the deal is a big one for Pappas.

Although specific financials of the deal weren’t disclosed, a spokesperson noted: “The exit is amongst Pappas Capital’s most successful in its 25-plus-year history.”

The Durham-based venture firm had backed VelosBio, which is based in San Diego and focuses on oncology, in rounds of $58 million and $137 million. The latter round closed in July.

Pappas also was involved in the VelosBio board with Managing Partner Kyle Rasbach acting as board observer.

“At Pappas, our focus has long been on identifying and executing on investment opportunities in innovative life science companies and partnering with exceptional teams to bring these technologies to market. VelosBio serves as an ideal example of our strategy at work, and we are thrilled to watch the Company embark on its next phase of growth as part of Merck,” Rasbach said in a statement.

“This acquisition is a transformative event that will propel the advancement of VLS-101 as a potential new cancer treatment, and we are humbled to have worked closely with the VelosBio team to achieve this milestone. We look forward to continuing to build upon our investment track record by sourcing new opportunities that seek to not only provide superior results to our investors, but just as importantly, improve the lives of patients.”

VelosBio launched in 2017.

The exit is the second this year for Pappas. Portfolio firm Curizon Pharmaceuticals was acquired by Horizon Therapeutics in April.

Pappas, which launched in 1994, has raised more than $500 million over the years and invested in some 85 companies.