Following the US Food and Drug Administration (:FDA) approval for the said indication, Merck KGaA will initially be responsible for the commercialization of TH-302, while Threshold Pharma will receive tiered, double-digit royalty on sales. As a part of the agreement, Threshold Pharma will have the option to co-promote the candidate in the US.
Outside the US, Merck KGaA will be solely responsible for the commercialization of TH-302 and Threshold Pharma will receive tiered, double-digit royalty on sales in these territories.
Merck KGaA and Threshold Pharma will jointly develop TH-302 for all other cancer indications.
Under the deal, Threshold Pharma will receive an upfront payment of €19 million ($25 million) and is eligible to receive up to €26.5 million ($35 million) as development milestone payments during 2012. Threshold Pharma can also receive a €15 million ($20 million) milestone payment if the candidate delivers positive phase II results in pancreatic cancer. Further, Merck KGaA will pay 70% of worldwide development costs for TH-302.
We believe this agreement is a positive development for the company as it will help expand Merck KGaA’s oncology portfolio.