Big pharma Merck is paying Endocyte $120 million upfront and milestone payments of up to $880 million based on successful achievement of development, regulatory and commercialization goals in a total of six cancer indications.
If vintafolide receives regulatory approval, Endocyte will receive an equal share of the profit in the United States (U.S.) as well as a double digit percentage royalty on sales of the product in the rest of the world.
Endocyte has retained the right to co-promote vintafolide with Merck in the U.S. and Merck has the exclusive right to promote vintafolide in the rest of world.
Vintafolide is currently being evaluated in a Phase III clinical trial for platinum-resistant ovarian cancer, (PROCEED trial) and a Phase II trial for non-small cell lung cancer (NSCLC); both studies are also using Endocyte’s investigational companion diagnostic agent, etarfolatide (EC20).
The deal comes as a bit of a surprise after vintafolide provided inconclusive data in a phase IIb study as recently as December 2011. At the time, Endocyte’s shares bombed on the news, plummeting 65 percent after the drug appeared to be no better than the comparitor.
Despite this drawback, it seems Merck had already seen enough to give it the confidence to proceed with the deal. Perhaps the devil is in the detail and Merck has seen sufficient to allow it to ignore the indifferent data.
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