Merck, ARIAD Restructure Ridaforolimus Collaboration

Merck and ARIAD Pharmaceuticals have announced the restructuring of their collaboration on the effort to bring ridaforolimus—ARIAD’s investigational mTOR inhibitor—to market. The companies, which first entered into the collaboration almost 3 years ago, have been working together to develop the agent in multiple potential cancer indications.

According to the terms of the amended agreement, Merck receives an exclusive license for the development and worldwide commercialization of ridaforolimus in exchange for an up-front cash payment of $50 million to ARIAD. Merck will also be reimbursing the Cambridge, Massachusetts, pharmaceutical company for any ridaforolimus-related expenses incurred since January 1, 2010. Merck has agreed to assume 100% of the future costs for developing, manufacturing, and commercializing the drug.

In a statement issued by Merck, Muna Bhanj, senior vice president and general manager of the company’s oncology franchise, noted that the amended agreement “positions Merck and ARIAD to maximize the therapeutic potential of ridaforolimus by evaluating its properties in multiple cancer types and furthers Merck’s commitment to oncology research and advancing the health of people suffering from cancer.”

According to an ARIAD news release, the amended agreement calls for ARIAD to receive royalties on US sales and “tiered double-digit royalties” on global net sales of the agent. The tiered royalties will reportedly be approximately one-third greater than the rates stipulated in the original agreement. ARIAD also retains an option to co-promote up to 20% of the sales effort in the United States, with Merck compensating ARIAD for its sales efforts.

“With Merck assuming all costs associated with the development, manufacture, and commercialization of ridaforolimus and providing ARIAD with near-term cash payments totaling approximately $69 million, we have greatly strengthened our balance sheet,” said Harvey J. Berger, MD, chairman and chief executive officer of ARIAD, in the company’s press statement. “We are retaining critically important commercial value through substantial global royalties, regulatory and sales milestones, and a co-promotion option, and eliminating the need for us to fund 50% of the ridaforolimus costs.” Berger went on to say the agreement would allow ARIAD to focus its resources on initiating a pivotal trial for AP24534, an investigational pan BCR-ABL inhibitor that ARIAD described as its “next promising product candidate.” The company also plans to proceed with development of AP26113, an investigational ALK inhibitor.

Ridaforolimus is currently being evaluated in the phase III SUCCEED (Sarcoma Multi-Center Clinical Evaluation of the Efficacy of Ridaforolimus) trial in patients with metastatic soft-tissue and bone sarcomas who have had a favorable response to chemotherapy. Full data analysis is expected in the fourth quarter of 2010. The agent is also being studied in several phase II clinical trials, including advanced endometrial cancer, prostate cancer, and non—small cell lung cancer. The transitioning of all ridaforolimus activities to Merck is expected to be completed within the next 6 months.