AstraZeneca and Merck Strike $50 Million Deal for Cancer Drug

AstraZeneca (NYSE: AZN  ) has inked a worldwide licensing agreement with Merck (NYSE: MRK  ) for the development, manufacturing, and marketing rights to Merck's small molecule inhibitor ovarian cancer drug MK-1775, the companies announced today.

AstraZeneca will pay Merck a $50 million upfront fee for MK-1775, in addition to future payments that are "tied to development and regulatory milestones plus sales-related payments and tiered royalties," according to the companies' statement.

MK-1775, which is used in conjunction with traditional chemotherapy treatments for cancer patients, is currently in the Phase 2a trial stage. According to AstraZeneca, evidence suggests "the combination of MK-1775 and DNA damage-inducing chemotherapy agents can enhance anti-tumor properties, in comparison to chemotherapy alone."

Susan Galbraith, head of AstraZeneca's Oncology Innovative Medicines unit, was quoted in the companies' statement as saying that MK-1775 is "a strong addition to AstraZeneca's growing oncology pipeline, which already includes a number of inhibitors of the DNA damage response."

The deal between the two pharma giants is contingent upon expiration or termination of the waiting period required by the Federal Trade Commission's Hart-Scott-Rodino Act.

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