Vertex (VRTX) entered into a licensing agreement with Merck KGaA, Darmstadt, Germany for the worldwide development and commercialization of four research and development programs that the firm believes represent novel approaches to cancer treatment
Merck KGaA will license two clinical-stage programs targeting DNA damage and repair, along with two additional novel pre-clinical programs.
Upon the agreement Vertex will receive an upfront payment of $230 million, in addition to royalties on future net sales.
Merck KGaA, Darmstadt, Germany will assume full responsibility for the development and commercialization of all the programs.
Merck KGaA believes the deal will significantly strengthen its oncology pipeline in two attractive areas, DNA damage and repair and immuno-oncology.
The two clinical-stage programs, which aim at inhibiting the DNA repair pathways that are fundamental to the survival and proliferation of certain cancers are:
– An ataxia telangiectasia and Rad3 related (ATR) protein kinase inhibitor program comprised of two compounds, VX-970 and VX-803.
VX-970 is being investigated broadly through 10 ongoing Phase 1 and Phase 2 trials across a variety of tumors and patient subtypes expected to be responsive to ATR inhibition based on biomarker data.
Preliminary VX-970 clinical data were presented at the 2016 American Society of Clinical Oncology (ASCO) Annual Meeting and the 2016 American Association for Cancer Research (AACR) Annual Meeting.
VX-803 is an orally dosed ATR inhibitor currently in Phase 1 trials evaluating escalating doses of VX-803 alone and in combination with chemotherapy.
– A DNA-dependent protein kinase (DNA-PK) inhibitor program including the clinical candidate VX-984. A Phase 1 trial is now evaluating escalating doses of VX-984 alone and in combination with pegylated liposomal doxorubicin in subjects with advanced solid tumors. Merck KGaA, Darmstadt, Germany will combine these assets with its existing DNA-PK assets into a single development program.
The pre-clinical programs include one immuno-oncology program against an attractive target with first-in-class potential, and a program against a completely novel target.
For both of these programs, Studies demonstrated efficacy in pre-clinical models, including potential successful combination with immune checkpoint inhibitors for the immunotherapy.
Merck KGaA has a leading presence in immunotherapy and DNA damage and repair, that are highly expected to change the way cancer is being treated.
The collaboration, and the related $230 million upfront payment, is subject to the expiration of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act.
The deal is great for Vertex as the cash it needed to support its investment in its cystic fibrosis franchise. It takes care of spending on the development of its promising oncology drugs and accelerate the development of these drugs.
Following the approvals the royalties on such important cancer products will be large.
The agreement is also great for Merck KGaA, which is now racing to be a leader in immunotherapy and immunotherapy combinations.
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