WEST LAFAYETTE, Ind. ( TheStreet) -- Endocyte ( ECYT) shares doubled in value Monday following the licensing of its experimental ovarian cancer drug EC145 to Merck ( MRK). Under terms of the agreement, Merck is paying $120 million in cash to Endocyte for worldwide rights to EC145, which recently began a late-stage study in patients with advanced ovarian cancer. Endocyte must continue to pay for the phase III study, with results expected in 2014. Shares of Endocyte rose 103% to $7.69 in early Monday trading. EC145 is an injectable form of folate (vitamin B9) linked to a tumor-killing chemotherapy. The drug is designed to target fast-growing cancer cells with an excess of folate receptors on their surface. Endocyte is developing a companion test used to identify patients with tumors containing an over-abundance of folate receptors. In a previously disclosed phase II study, treatment with EC145 delayed the growth of ovarian cancer by two and half months compared to patients treated with doxorubicin, another chemotherapy drug. But EC145 was unable to prolong survival in ovarian cancer patients; and in fact, patients treated with doxorubicin lived longer. Endocyte said the negative survival results resulted from imbalances in the study skewed in favor of patients treated with doxorubicin. Nonetheless, Endocyte shares fell from $10 to $3 last December when the negative survival results were released. Even with Endocyte's climb Tuesday on the Merck deal, the stock hasn't fully recovered yet. In its Merck agreement, Endocyte is eligible for another $880 million in future milestone payments tied to EC145's approval, commercial sales and expansion into up to six other cancer indications. Endocyte will split profits equally with Merck on U.S. sales of EC145; Merck will pay double-digit royalties on sales of the drug outside the U.S. Merck is not known as a strong cancer-focused company, with just a single drug, Zolinza for cutaneous T-cell lymphoma, in its portfolio. Merck has partnered with Ariad Pharmaceuticals ( ARIA) to develop the sarcoma drug ridaforolimus, which has an FDA approval decision date of June 5. An advisory panel convened March voted against recommending the drug's approval. --Written by Adam Feuerstein in Boston. >To contact the writer of this article, click here: Adam Feuerstein. >To follow the writer on Twitter, go to http://twitter.com/adamfeuerstein. >To submit a news tip, send an email to: firstname.lastname@example.org. Follow TheStreet on Twitter and become a fan on Facebook.