By Natalia Drozdiak
FRANKFURT-- Pfizer Inc. and Germany's Merck KGaA are teaming up
to develop a new tumor treatment product, in a move that will boost
the U.S. company's oncology business but reduce its full-year
earnings per share.
Merck will receive $850 million upfront to jointly develop and
commercialize an anti-PD-L1 antibody with Pfizer and could receive
a further $2 billion in regulatory and commercial milestone
payments. Merck is already developing the drug as a treatment
against various types of tumors.
The two companies will also push to advance Pfizer's anti-PD-1
antibody into phase 1 trials.
As a result of the transaction, Pfizer is downgrading its
previous 2014 reported diluted earnings per share guidance to
between $1.40 and $1.49, from between $1.50 and $1.59.
Both companies will jointly fund development and
commercialization costs and will share all revenues from selling
any anti-PD-L1 or anti-PD-1 products, Merck added. The move will
help bolster both the companies' presence in the immune-oncology
industry, it said.
Merck said about 20 immuno-oncology clinical development
programs are set to begin next year.
Write to Natalia Drozdiak at natalia.drozdiak@wsj.com
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