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Merck Enters into Exclusive Global License for LM-299, An Investigational Anti-PD-1/VEGF Bispecific Antibody from LaNova Medicines Ltd.

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Merck (MRK) has entered into an exclusive global license agreement with LaNova Medicines for LM-299, a novel investigational PD-1/VEGF bispecific antibody. Merck will pay an upfront payment of $588 million and potential milestone payments of up to $2.7 billion for the rights to develop, manufacture, and commercialize LM-299 across multiple indications. The transaction is expected to close in Q4 2024, subject to regulatory approvals. Merck will record a pre-tax charge related to the upfront payment in the quarter the transaction closes.

Merck (MRK) ha stipulato un accordo di licenza globale esclusiva con LaNova Medicines per LM-299, un nuovo anticorpo bispecifico in fase di indagine PD-1/VEGF. Merck pagherà un pagamento iniziale di 588 milioni di dollari e potenziali pagamenti di milestone fino a 2,7 miliardi di dollari per i diritti di sviluppare, produrre e commercializzare LM-299 in diverse indicazioni. Si prevede che la transazione si chiuda nel quarto trimestre del 2024, soggetta ad approvazioni normative. Merck registrerà un onere ante imposte relativo al pagamento iniziale nel trimestre in cui si chiude la transazione.

Merck (MRK) ha firmado un acuerdo de licencia global exclusivo con LaNova Medicines para LM-299, un anticuerpo bispecífico PD-1/VEGF en fase de investigación. Merck pagará un pago inicial de 588 millones de dólares y posibles pagos por hitos de hasta 2.7 mil millones de dólares por los derechos de desarrollar, fabricar y comercializar LM-299 en múltiples indicaciones. Se espera que la transacción se cierre en el cuarto trimestre de 2024, sujeto a aprobaciones regulatorias. Merck registrará un cargo antes de impuestos relacionado con el pago inicial en el trimestre en que se cierre la transacción.

Merck (MRK)LaNova Medicines와 세계적인 독점 라이센스 계약을 체결했습니다. LM-299는 새로운 PD-1/VEGF 이중특이성 항체로 현재 조사 중입니다. Merck는 5억 8800만 달러의 선불금을 지급하고, LM-299를 개발, 제조 및 상용화할 권리에 대해 최대 27억 달러의 이정표 지급금을 받을 수 있습니다. 이 거래는 규제 승인 조건을 충족하며 2024년 4분기 내에 마감될 것으로 예상됩니다. Merck는 거래 마감 분기 내에 선불금과 관련된 세전 비용을 기록할 것입니다.

Merck (MRK) a conclu un accord de licence mondiale exclusive avec LaNova Medicines pour LM-299, un anticorps bispécifique PD-1/VEGF en cours d'investigation. Merck versera un paiement initial de 588 millions de dollars et des paiements d'étape potentiels pouvant aller jusqu'à 2,7 milliards de dollars pour les droits de développer, fabriquer et commercialiser LM-299 dans plusieurs indications. La transaction devrait se finaliser au quatrième trimestre 2024, sous réserve des approbations réglementaires. Merck enregistrera une charge avant impôts liée au paiement initial au trimestre de la finalisation de la transaction.

Merck (MRK) hat eine exklusive globale Lizenzvereinbarung mit LaNova Medicines für LM-299, einen neuartigen PD-1/VEGF bispezifischen Antikörper, abgeschlossen. Merck zahlt eine Vorauszahlung von 588 Millionen US-Dollar und potenzielle Meilensteinzahlungen von bis zu 2,7 Milliarden US-Dollar für die Rechte zur Entwicklung, Herstellung und Vermarktung von LM-299 in mehreren Indikationen. Es wird erwartet, dass die Transaktion im vierten Quartal 2024, vorbehaltlich der behördlichen Genehmigungen, abgeschlossen wird. Merck wird eine vorsteuerliche Belastung im Zusammenhang mit der Vorauszahlung im Quartal, in dem die Transaktion abgeschlossen wird, verbuchen.

Positive
  • Acquisition of promising oncology asset expanding Merck's pipeline
  • Global exclusive rights for development, manufacturing, and commercialization
  • Multiple potential indications for LM-299 development
Negative
  • Significant upfront payment of $588 million impacting financial results
  • Additional potential milestone payments of up to $2.7 billion
  • Transaction subject to regulatory approval with closing uncertainty

Insights

This licensing deal represents a significant strategic investment by Merck in expanding its oncology portfolio. The $588 million upfront payment and potential $2.7 billion in milestone payments indicate high confidence in LM-299's market potential. The bispecific antibody targeting both PD-1 and VEGF pathways could be particularly valuable given the growing immunotherapy market.

The transaction's structure, with substantial milestone payments tied to development and commercialization, effectively shares risk between both parties while providing LaNova with immediate capital. The Q4 2024 expected closing suggests careful regulatory consideration, while the pre-tax charge impact on earnings indicates material financial significance for Merck.

The PD-1/VEGF bispecific antibody represents an innovative approach combining two critical cancer-fighting mechanisms: immune checkpoint inhibition and anti-angiogenesis. This dual-targeting strategy could potentially offer improved efficacy over single-target therapies, particularly in resistant tumors. The technology complements Merck's existing portfolio, which includes Keytruda and could provide new options for combination therapies.

The development across multiple indications suggests broad therapeutic potential, though clinical validation will be crucial. This acquisition aligns with the industry trend toward multi-targeting antibodies in cancer treatment.

RAHWAY, N.J.--(BUSINESS WIRE)-- Merck (NYSE: MRK), known as MSD outside of the United States and Canada, and LaNova Medicines Ltd. (LaNova), a privately held clinical-stage biotechnology company, today announced that Merck has entered into an exclusive global license to develop, manufacture and commercialize LM-299, a novel investigational PD-1/VEGF bispecific antibody from LaNova.

“At Merck, we continue to assemble a strong and diversified oncology pipeline spanning differentiated mechanisms and multiple modalities,” said Dr. Dean Y. Li, president, Merck Research Laboratories. “This agreement adds to Merck’s growing oncology pipeline and we look forward to advancing LM-299 with speed and rigor for patients in need.”

Under the agreement, LaNova has granted Merck an exclusive global license to develop, manufacture and commercialize LM-299. LaNova will receive an upfront payment of $588 million. LaNova is also eligible to receive up to $2.7 billion in milestone payments associated with the technology transfer, development, regulatory approval and commercialization of LM-299 across multiple indications.

“This agreement with Merck is a strong testament to the hard work of LaNova’s talented team of scientists who created LM-299,” said Dr. Crystal Qin, founder, chairwoman and chief executive officer, LaNova. “Through internal R&D innovation and strategic external partnerships, LaNova is committed to advancing its pipeline to benefit patients worldwide.”

Closing of the proposed transaction is subject to approval under the Hart-Scott-Rodino Antitrust Improvements Act and other customary conditions. The transaction is expected to close in the fourth quarter of 2024. Merck expects to record a pre-tax charge relating to the $588 million payment due upon closing to be included in GAAP and non-GAAP results in the quarter that the transaction closes, and the EPS impact of such charge will be disclosed at that time.

About LM-299

LM-299 is an investigational bispecific antibody targeting both programmed cell death protein-1 (PD-1) and vascular endothelial growth factor (VEGF). This innovative therapeutic approach is designed to inhibit both PD-1/PD-L1 and VEGF/VEGFR receptor signaling pathways releasing a key immune checkpoint while also inhibiting the production of new blood vessels (angiogenesis). LM-299 has a differentiated molecular design, comprising an anti-VEGF antibody linked to two C-terminal single domain anti-PD-1 antibodies. A Phase 1 clinical trial for LM-299 is currently enrolling patients in China.

About LaNova Medicines Ltd.

Founded in September 2019, LaNova Medicines Ltd. is a privately held biotech company headquartered in Shanghai. With the mission of "Care for life, Dedicate to innovation", the Company focuses on discovering novel biologic therapies in the fields of ADC and Immuno-Oncology, with a commitment to developing best-in-class or first-in-class therapies that address significant unmet medical needs.

LaNova's robust portfolio is made possible by an industry-leading R&D engine, which includes three distinct platforms: a proprietary antibody platform capable of generating antibodies against a range of targets, including multi-transmembrane proteins and GPCRs; a next-generation ADC platform that utilizes proprietary payload and linker technologies to produce highly differentiated ADCs; and a modular 4-1BB-based T-cell engager (TCE) platform for developing bispecific antibodies targeting distinct tumor-associated antigens (TAAs).

About Merck

At Merck, known as MSD outside of the United States and Canada, we are unified around our purpose: We use the power of leading-edge science to save and improve lives around the world. For more than 130 years, we have brought hope to humanity through the development of important medicines and vaccines. We aspire to be the premier research-intensive biopharmaceutical company in the world – and today, we are at the forefront of research to deliver innovative health solutions that advance the prevention and treatment of diseases in people and animals. We foster a diverse and inclusive global workforce and operate responsibly every day to enable a safe, sustainable and healthy future for all people and communities. For more information, visit www.merck.com and connect with us on X (formerly Twitter), Facebook, Instagram, YouTube and LinkedIn.

Forward-Looking Statement of Merck & Co., Inc., Rahway, N.J., USA

This news release of Merck & Co., Inc., Rahway, N.J., USA (the “company”) includes “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. These statements are based upon the current beliefs and expectations of the company’s management and are subject to significant risks and uncertainties. There can be no guarantees with respect to pipeline candidates that the candidates will receive the necessary regulatory approvals or that they will prove to be commercially successful. If underlying assumptions prove inaccurate or risks or uncertainties materialize, actual results may differ materially from those set forth in the forward-looking statements.

Risks and uncertainties include but are not limited to, general industry conditions and competition; general economic factors, including interest rate and currency exchange rate fluctuations; the impact of pharmaceutical industry regulation and health care legislation in the United States and internationally; global trends toward health care cost containment; technological advances, new products and patents attained by competitors; challenges inherent in new product development, including obtaining regulatory approval; the company’s ability to accurately predict future market conditions; manufacturing difficulties or delays; financial instability of international economies and sovereign risk; dependence on the effectiveness of the company’s patents and other protections for innovative products; and the exposure to litigation, including patent litigation, and/or regulatory actions.

The company undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise. Additional factors that could cause results to differ materially from those described in the forward-looking statements can be found in the company’s Annual Report on Form 10-K for the year ended December 31, 2023 and the company’s other filings with the Securities and Exchange Commission (SEC) available at the SEC’s Internet site (www.sec.gov). 

Merck Media Contacts:



Robert Josephson

(203) 914-2372



Justine Moore

(347) 281-3754



Merck Investor Contacts:



Peter Dannenbaum

(732) 594-1579



Steven Graziano

(732) 594-1583

Source: Merck & Co., Inc.

FAQ

What is the value of Merck's (MRK) upfront payment for LM-299?

Merck will make an upfront payment of $588 million to LaNova Medicines for the LM-299 license agreement.

When is Merck's (MRK) LM-299 license agreement expected to close?

The transaction is expected to close in the fourth quarter of 2024.

What is the total potential value of milestone payments in Merck's (MRK) LM-299 deal?

LaNova is eligible to receive up to $2.7 billion in milestone payments related to technology transfer, development, regulatory approval, and commercialization.

What type of drug is LM-299 in Merck's (MRK) new license agreement?

LM-299 is a novel investigational PD-1/VEGF bispecific antibody for oncology treatment.

Merck & Co., Inc.

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