This collaboration will be focused on the development of small-molecule inhibitors against several drug targets, including the KRAS oncogene. The organizations will combine resources, including a library of preclinical candidates, data, knowledge, and expertise, to accelerate discovery and development of new therapies, according to the companies.

KRAS is one of the most commonly mutated genes in cancer, occurring in over 90% of pancreatic cancers and in around 20% of non-small cell lung cancers.

"At Merck we continue to pursue new regimens designed to extend the benefits of highly selective therapies to more patients with cancer," said Dr. Roger Perlmutter, PhD, president of Merck Research Laboratories. "This agreement with Taiho and Astex combines our respective small molecule assets and industry-leading expertise in cancer cell signaling to enable development of the most promising drug candidates."

In exchange for providing Merck an exclusive global license to its small-molecule inhibitor candidates, Taiho and Astex will receive an aggregate upfront payment of $50 million and will be eligible to receive approximately $2.5 billion contingent upon the achievement of preclinical, clinical, regulatory, and sales milestones for multiple products arising from the agreement, as well as tiered royalties on sales. Merck will fund research and development and will be responsible for commercialization of products globally. Taiho has retained cocommercialization rights in Japan and an option to promote in specific areas of Southeast Asia.

"Taiho has used its unique and proprietary drug discovery platform to generate a number of small-molecule inhibitors," said Teruhiro Utsugi, PhD, managing director at Taiho. "This alliance builds on our KRAS research up to now and together with Merck, allows us to combine our expertise to significantly accelerate the global research, development, and commercialization of a number of our mutant KRAS programs by accessing external talent and resources."