Plymouth, Mich.-based Lycera will receive $12 million upfront and up to $295 million in milestone payments from Merck in a collaboration to discover new anti-inflammatory drugs, according to FierceBiotech. The deal is focused on new small molecules that target T-helper 17 (Th17) cells, key mediators of inflammation and a new approach to treating major autoimmune diseases such as rheumatoid arthritis, psoriasis, inflammatory bowel disease and multiple sclerosis.

"We are delighted to be working with Merck, which brings industry leading expertise in drug discovery, development and commercialization to this collaboration," said Gary Glick, Lycera founder and chief scientific officer. "This joint partnership is a significant validation of Lycera's discovery capabilities and our Th17 program, and enables us to expand the scope of our research in this promising area to expedite our discovery efforts as well as our timeline to enter the clinic."

Lycera's technology is built around the observation that mice with RORγt deficient T cells lack Th17 cells, which produce the inflammatory cytokine interleukin-17. And by targeting Th17, it has been able to reduce the production of IL-17 in cells and in vivo. Lycera was launched four years ago and has raised $36 million in venture funding.