Merck said the agreement would allow for the development, manufacture and distribution of the treatment, which is will named MK-7110, following its Emergency Use Authorization approval from the Food & Drug Administration. Merck acquired the treatment last month through its $425 million takeover of Rockville, Maryland-based Oncolmmune, which said its developing therapy can sharply reduce the risk of death or respiratory failure in patients suffering from severe forms of COVID-19.
The deal would pay Merck around $356 million for the manufacture and supply of between 60,000 and 100,000 doses of MK-7110 by then end of June, the company said.
“Building upon the promising clinical findings to date for MK-7110, Merck is pleased to be collaborating with the U.S. Government to advance the manufacture and distribution of this candidate for patients with serious COVID-19 disease,” said Merck Research Laboratories president Roger Perlmutter.
Merck shares were marked 0.6% higher in early trading Wednesday to change hands at $79.90 each.
Oncolmmune published late-stage data from a phase 3 trial evaluating its lead therapeutic candidate, CD24Fc, in September that showed a 60% higher probability of improvement for patients suffering severe or critical COVID-19 when compared to placebo.
The risk of death or respiratory failure was also reduced by more than 50%, Oncolmmune data indicated.
Oncolmmune will spin-out the rights and assets related to CD24Fc into a separate entity, the companies said, with Merck investing a further $50 million to become a minority shareholder.