Merck (MSD outside of the U.S. and Canada), and Kelun-Biotech (a holding subsidiary of Sichuan Kelun Pharmaceutical Co., Ltd), have entered into an exclusive license and collaboration agreement to develop seven investigational preclinical antibody-drug conjugates (ADC) for the treatment of cancer.\n\n\n\n“Advances in ADC technologies are yielding a new generation of candidates designed to more precisely target and deliver potent anticancer agents to the tumor site,” said Dean Y. Li, president, Merck Research Laboratories. \n\n\n\n“We continue to augment our oncology pipeline and look forward to working with the Kelun-Biotech team to advance these candidates to the patients that need them.”\n\n\n\nUnder the agreement, Kelun-Biotech has granted Merck exclusive global licenses to research, develop, manufacture and commercialize multiple investigational preclinical ADC therapies and exclusive options to obtain additional licenses to ADC candidates. Kelun-Biotech retains the right to research, develop, manufacture and commercialize certain licensed and option ADCs for China, Hong Kong and Macau.\n\n\n\n“The further expansion of our collaboration with Merck provides a strong endorsement for our technology from a leader in the development of cancer treatments,” said Junyou Ge, chief executive officer of Kelun-Biotech. \n\n\n\n“We are grateful for our partnership with the Merck scientists.”\n\n\n\nKelun-Biotech will receive an upfront payment of $175 million from Merck. Kelun-Biotech is also eligible to receive future development, regulatory and sales milestone payments totaling up to $9.3 billion, if Kelun-Biotech does not retain China, Hong Kong and Macau rights for the option ADCs and all candidates achieve regulatory approval, plus tiered royalties on net sales for any commercialized ADC product. \n\n\n\nMerck also intends to make an equity investment in Kelun-Biotech. The transaction is subject to customary closing conditions including regulatory approval under the Hart-Scott Rodino (HSR) Act and approvals by the shareholders of Kelun-Biotech and Sichuan Kelun Pharmaceutical Co., Ltd.\n\n\n\nThis announcement follows previously disclosed research collaboration and licensing agreements for two ADC candidates including MK-2870 (also known as SKB-264), an investigational TROP2 targeting ADC currently being evaluated in late-stage clinical trials.