(Adds analyst comments, share price)

July 6 (Reuters) - Drugmaker Merck & Co is in advanced talks to buy cancer-focused biotech company Seagen Inc in a deal that could be worth roughly $40 billion or more, the Wall Street Journal reported on Wednesday.

The companies are discussing a price above $200 a share for Seagen, the report said, citing people familiar with the matter. (https://on.wsj.com/3uu3tMa)

At Wednesday's closing share price of $175, Seagen has a market capitalization of $32.24 billion, according to Refinitiv data.

Merck did not immediately respond to a Reuters request for comment outside business hours, while Seagen declined to comment.

Seagen's shares rose about 5% to $184 in premarket trading, while Merck fell 1%.

It makes sense if Merck can close the deal at $250 or below as the acquisition will help the drugmaker fortify its portfolio ahead of top money-spinner Keytruda losing its marketing exclusivity, Wells Fargo analyst Mohit Bansal said.

Cancer drug Keytruda, set to lose exclusivity in 2028, generated sales of $17.2 billion in 2021 and accounted for 35.2% of Merck's total revenue.

Seagen has several clinical-stage oncology candidates, as well as four approved drugs including breast cancer therapy Tukysa, which together brought in more than $1 billion in revenue last year.

The companies are seeking to seal the deal on or before the announcement of Merck's second-quarter earnings set for July 28, according to the WSJ report.

The acquisition talks come at a time when several big corporate deals have been shelved as a downturn in equity markets hurts company valuations, while rising borrowing costs make deal financing costlier and harder to access.

Walgreens Boots Alliance in June scrapped its plan to sell its UK pharmacy chain Boots, while U.S. department store chain Kohl's last week called off its sale to Franchise Group after months of negotiations.

Bansal, however, said Merck's balance sheet capacity would not be an issue for the deal.

(Reporting by Mrinalika Roy, Shivam Patel and Ann Maria Shibu in Bengaluru; Editing by Arun Koyyur and Shounak Dasgupta)