Merck Collaboration
In July 2007, ARIAD and Merck & Co., Inc. – one of the leading global pharmaceutical companies dedicated to developing and commercializing new oncology drugs – announced a landmark global collaboration to jointly develop and commercialize deforolimus for use in cancer.
Our global development plan (GDP) with Merck encompasses the first three full years of the partnership (2008-2010). Over this time period, the companies anticipate that at least four cancer indications will be pursued in addition to sarcomas: endometrial, prostate, breast and non-small cell lung cancers. Deforolimus will be studied both as a single agent and in combination with various targeted agents driven by mechanisms of action and biology. During 2008, the GDP calls for initiation of multiple clinical trials, including Phase 2 trials in endometrial, breast, and prostate cancers. As part of the three-year plan, oral deforolimus will be studied worldwide, including Japan.
Both ARIAD and Merck share overall responsibility for global development and commercialization of deforolimus. In the U.S., ARIAD will distribute and sell deforolimus for all cancer indications and book all sales, and ARIAD and Merck will co-promote deforolimus. ARIAD and Merck will each receive 50 percent of the income from such sales. Outside the U.S., Merck will distribute, sell and promote deforolimus and book all sales. Merck will pay ARIAD tiered double-digit royalties on such end-market sales of deforolimus.
In the U.S., ARIAD will have primary responsibility for development of deforolimus in the metastatic sarcoma indication. Merck and ARIAD will have joint responsibility in the U.S. for development of all other cancer indications being pursued. Outside the U.S., Merck will have primary responsibility for development in all cancer indications being pursued.
The collaboration provides ARIAD with up-front and milestone payments, sharing of development costs and other provisions that may be valued at approximately $1 billion based on successful development of deforolimus in multiple cancer indications and achievement of significant sales milestones, excluding potential commercial returns from profit-sharing in the U.S. or royalties paid by Merck for sales of deforolimus outside the U.S.
Drug-Eluting Stents Collaborations
According to the American Heart Association’s Heart Disease and Stroke Statistics for 2007, an estimated 79.4 million (one in three) American adults were afflicted with one or more types of cardiovascular disease. The estimated direct and indirect cost of cardiovascular disease for the year 2007 exceeded $430 million.
Products expected to have the most profound impact on coronary artery and myocardial disorders include drug-eluting stents. The U.S. market for interventional cardiology devices is valued at approximately $5 billion, with drug-eluting stents representing the largest segment of the market.*
As an mTOR inhibitor, deforolimus has been shown to block the proliferation and migration of vascular smooth muscle cells, the primary cause of narrowing and blockage of injured arteries, and is an analog of sirolimus, another mTOR inhibitor that has been approved for use in drug-eluting stents. Recent clinical studies have found lower reblockage rates in patients treated with stents that deliver small-molecule drugs, such as sirolimus or paclitaxel, a cytotoxic agent, locally to the site of vascular injury. Such stents have become the standard-of-care for patients undergoing interventional procedures to open narrowed coronary arteries.
We entered into license agreements with Medinol, Ltd., a leading innovator in stent technology, in January 2005, and with ICON Medical Corp., an emerging medical device company, in October 2007, to develop and commercialize stents and other medical devices that deliver deforolimus to prevent restenosis, or reblockage, of injured vessels following interventions in which stents are used in conjunction with balloon angioplasty. We have retained the right to enter into one additional non-exclusive license agreement, in addition to the licenses granted to ICON and Medinol, to develop and commercialize medical devices delivering deforolimus for use in vascular disease.
* Source: U.S. Market for Interventional Cardiology Devices (Vancouver: iData Research Inc., 2007).
