Under an exclusive worldwide research collaboration and licence agreement, the companies will be engaged in the development of small molecule inhibitors against several drug targets, which include the KRAS oncogene.
Assessment of the small molecule inhibitors in the treatment of cancer is currently underway.
Astex president and CEO, Dr Harren Jhoti, said: “Together with our Taiho colleagues we are delighted to be working with Merck, one of the global leaders in oncology drug development, on this strategic alliance. This collaboration is another testament to Astex’s position as the leader in fragment-based drug discovery.”
As per the deal, the companies will bring together the expertise of their respective research programmes, while also combining preclinical candidates and their data.
Merck will be shelling out a total upfront payment to the tune of $50m to Taiho and Astex for the exclusive global licence to use their small molecule inhibitor candidates.
The deal also allows Taiho and Astex to receive about $2.5bn contingent payments based on the achievement of preclinical, clinical, regulatory and sales milestones for multiple products. In addition, the companies will secure tiered royalties on sales.
Apart from providing funds for research and development, Merck will also take responsibility for commercialisation of products across the globe.
Taiho retains co-commercialisation rights in Japan along with an option to promote in certain parts of South East Asia.
Merck Research Laboratories’ president, Dr Roger Perlmutter, said: “At Merck we continue to pursue new regimens designed to extend the benefits of highly selective therapies to more patients with cancer.
This agreement with Taiho and Astex combines our respective small molecule assets and industry-leading expertise in cancer cell signaling to enable development of the most promising drug candidates.”
In December 2019, Merck struck a $2.7bn deal to purchase biopharmaceutical firm ArQule.
ArQule is involved in the research and development of targeted therapeutics for the treatment of cancers and certain rare diseases.