Merck & Co., in busy morning, taps Moderna's therapeutic cancer vaccine, Royalty in schizophrenia deal

Merck & Co. had a busy morning signing off on licensing deals for midstage assets. The Big Pharma not only confirmed it would push ahead with developing a therapeutic cancer vaccine with mRNA leader Moderna but also signed up to collaborate on its schizophrenia treatment with Royalty Pharma.

First, the cancer vaccine, better known as mRNA-4157. Moderna is evaluating the asset in combination with Keytruda in a phase 2 trial as an adjuvant treatment for patients with high-risk melanoma.

Merck paid $200 million upfront in an agreement for a series of personalized cancer vaccines (PCVs) including mRNA-4157 back in 2016. Merck exercising its license to take mRNA-4157 forward means Moderna is now set for a $250 million payout, while any profits from the asset if it reaches the market will be shared equally.

PCVs are designed to prime a patient’s immune system so that it generates a tailored anti-tumor response. MRNA-4157, which encodes up to 34 neoantigens, aims to generate T-cell responses based on the mutational signature of a patient's tumor.

Moderna is expecting primary data from the 157-participant KEYNOTE-942 trial this quarter. Patients in the study received up to nine doses of mRNA-4157 at 21-day intervals. The mRNA-4157-Keytruda combination doesn’t have a faultless clinical track record, having missed the mark in colorectal cancer but faring better in head and neck cancer in a small phase 1 study. 

Merck may have high hopes for mRNA-4157, but it gave up on another PCV from the two companies’ partnership. In February, Merck dumped Moderna’s mutant KRAS vaccine mRNA-5671 shortly after Merck closed enrollment in a phase 1 trial.

"We continue to be excited about the future and the impact mRNA can have as a new treatment paradigm in the management of cancer,” Moderna President Stephen Hoge, M.D., said in a release. “Continuing our strategic alliance with Merck is an important milestone as we continue to grow our mRNA platform with promising clinical programs in multiple therapeutic areas."

Meanwhile, today’s deal with Royalty is a fresh agreement. The partnership will see the two companies co-fund the development of MK-8189, an oral PDE10A inhibitor in a phase 2b trial for schizophrenia.

Royalty will pay $50 million upfront to Merck to support ongoing development of the therapy. If Merck decides to take MK-8189 into phase 3, Royalty will have the option to stump up another $375 million to co-fund the late-stage study. In return, Royalty will be eligible for milestone payments and royalties.

Royalty’s business model revolves around giving companies the funding support to push their assets through late-stage trials. Michael Egan, Merck Laboratories vice president of neuroscience global clinical development, labeled the deal with Royalty a “creative agreement” that could address the “serious unmet need for new therapeutic options for patients with schizophrenia.”