NEW YORK (AP) -- Merck & Co. said Monday it will work with Pfizer Inc. to develop a new combination pill designed to treat Type 2 diabetes.
The experimental pill will combine Merck's drug Januvia, Pfizer's experimental pill ertugliflozin, and metformin, an older diabetes drug. Merck said it paid Pfizer $60 million upfront and could make additional payments based on clinical development, regulatory review and sales of the new pill if it is approved.
Merck and Pfizer will split revenue from the pill and some of the costs on a 60-40 basis, with Merck getting the larger share of the revenues and expenses.
Late-stage clinical trials of ertugliflozin are expected to begin later this year.
Shares of Merck added 8 cents to $47.95 in midday trading and Pfizer shares gained 41 cents to $30.50.
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