NGM, Merck Enter Biologics R&D Pact

NGM Biopharmaceuticals and Merck have entered into a multi-year collaboration to research, discover, develop and commercialize novel biologic therapies across a range of therapeutic areas.
 
The collaboration includes multiple drug candidates currently in preclinical development at NGM, including NP201 being evaluated for the treatment of diabetes, obesity and nonalcoholic steatohepatitis (NASH). NGM will lead R&D for existing preclinical candidates and pursue other discovery stage programs. Merck will have the option to license any resulting NGM programs following human proof of concept trials for global product development and commercialization.
 
NGM will receive $94 million upfront and Merck will purchase a 15% equity stake in NGM for $106 million. Merck will commit as much as $250 million to fund NGM’s efforts under the initial five-year term of the collaboration, with the potential for additional funding.
 
Prior to Merck initiating a Phase III study for a licensed program, NGM may elect to receive milestone and royalty payments or to participate in a global cost and revenue share arrangement of as much as 50%. NGM also has the option to participate in the co-promotion of any co-funded program in the U.S.

NGM’s lead program, NGM282, currently in clinical development for primary biliary cirrhosis (PBC) and NASH, are not subject to the option under the Merck collaboration.
 
“We are very pleased to establish this alliance with Merck, which will be transformational for NGM, providing us with the resources and flexibility to pursue our ambitious research and development goals while preserving our unique drug discovery culture,” said William J. Rieflin, chief executive officer of NGM. “We look forward to working with Merck to generate a robust pipeline of therapies with the potential to make a significant difference in the lives of patients.”
 
“NGM has developed a uniquely powerful research program that has permitted identification of novel, and quite consequential, pathways for metabolic regulation,” said Dr. Roger M. Perlmutter, president of Merck Research Laboratories. “Through this new collaboration, we hope to apply Merck’s well-established translational capabilities to advance innovative biologics that address the needs of patients suffering from diabetes, metabolic dysregulation, and malignancy.”