Lycera, a biopharmaceutical company focused on autoimmune diseases, has signed a collaboration agreement with Merck, to discover, develop and commercialize small-molecule therapies directed to selected novel targets being investigated for the treatment of a broad range of immune-mediated disorders.

Lycera will receive an upfront payment and research funding, and is eligible to receive in excess of $300 million in research, development, regulatory and commercial milestone payments. Merck is responsible for clinical development and will have worldwide marketing and commercialization rights to any products that may be developed as a result of the collaboration. Lycera is entitled to receive royalty payments, as well as development and sales milestones, on global sales from any such products. Further details of the financial terms were not disclosed.

The new relationship builds on a previous agreement announced in 2011 that is focused on therapies targeting the retinoic acid related orphan receptor (RORγt), the key transcription factor coordinating both differentiation of T-helper 17 (Th17) cells and production of highly pro-inflammatory mediators such as interleukin-17 (IL-17).

"We are absolutely delighted to expand our relationship with Merck, a collaboration that builds on the culture of scientific excellence fostered by both companies," said Kathleen M. Metters, Ph.D., president and CEO of Lycera. "Lycera's proven track record in accelerating early stage programs to development candidate status holds the potential to fuel Merck's early stage pipeline."

Rupert Vessey, D.Phil., FRCP, senior vice president, global scientific strategy, Merck Research Laboratories, said, "There are substantial unmet medical needs and opportunities in autoimmune disorders, and new targets representing attractive opportunities that we are very pleased to pursue through our new collaboration with Lycera.”