Boston, MA 09/25/2014 (wallstreetpr) – Merrimack Pharmaceuticals Inc (NASDAQ:MACK) seeks to work with Baxter International Inc. (NYSE:BAX) in the development and marketing of its pancreatic cancer drug outside the U.S.
Terms Of Agreement
According to a Reuters’ report, Merrimack and Baxter will work in partnership to expand the market of Merrimack’s pancreatic drug outside of the country. According to the deal, Merrimack would be entitled to get as much as $100 million as an upfront payment from Baxter International Inc. (NYSE:BAX). The payment will be completed as early as within this quarter, the companies announced. Apart from this, Baxter will give another $120 million to Merrimack Pharmaceuticals Inc (NASDAQ:MACK) as milestone payments for its drug, called MM-398.
Advancing Development
The licensing agreement would fetch Merrimack additional $280 million in lieu of development of the drug. The cost also encompasses milestone payments that Baxter International Inc. (NYSE:BAX) would be liable to pay to Merrimack in case the drug shows successful results in treating another form of pancreatic cancer. Apart from this, Baxter will be due to pay another $220 million to the drug developing company if the drug is rendered approval to treat two other indications. Merrimack Pharmaceuticals Inc (NASDAQ:MACK) is already carrying out the development of the drug for two new indications, it said. However, the drug developer is eligible to retain all rights of marketing the drug in the U.S., according to the terms of the contract. In addition, marketing rights in Taiwan are separate, the companies informed.
Expanding Market
Merrimack Pharmaceuticals Inc (NASDAQ:MACK) is currently seeking approval from the U.S. Food and Drug Administration to market the drug, MM-398 that aims at treating pancreatic cancer, in other parts of the world. The company is in the process of filing an approval application with the FDA for selling it outside of the U.S. Merrimack wants to start marketing its drug in other countries by the beginning of 2015.
Shares of the company surged quickly with the announcement. Upon closing of the trade yesterday, figures reached $8.95, marking a surge of as much as 24%.
