Merck KGaA hands over IL-12-targeting cancer med to PDS Biotech in $121M deal

Merck KGaA’s new R&D strategy is continuing to run apace, with the company ramping up efforts to more swiftly sign onto and offload assets that have commercial potential. 

That plan has continued in the New Year, naturally, with the German Big Pharma handing over the rights of its IL-12-targeting cancer med to PDS Biotech in a deal worth more than $120 million. In exchange for M9241, PDS is paying $5 million upfront with $116 million waiting in the wings in potential biobucks, with the bulk of the milestone payments contingent on commercial achievements, according to Tuesday's unveiling.

The agreement builds off of existing familiarity between the two companies, which have been working to develop a triple combo immunotherapy to treat HPV-associated malignancies that’s in a phase 1/2 trial. That study includes M9241 (then referred to as NHS-IL12), in addition to M7824 and PDS Biotech’s PDS0101. An update to the clinical trial record posted last month indicated that recruitment had wrapped up, with 51 patients enrolled out of the 56 patients anticipated. The trial is now expected to be completed in January 2024, six months later than originally expected. 

In a release, PDS says it has a meeting scheduled with the FDA to discuss plans for a registrational trial of the triple combo. The IL-12 asset has an extensive development history beyond the triple combo test, having been tested to treat solid tumors in a phase 1 trial led by the National Cancer Institute that was completed seven years later than originally expected. The institute and the National Institutes of Health are also testing the med in conjunction with chemotherapy in a phase 1/2 trial that’s ongoing. 

The deal is the latest move in a game of clinical Tetris being played by Merck KGaA after the company emphasized the need for business development to improve efficiency. Up to now, that’s largely meant taking on new licensing deals rather than offloading its own assets. Almost two weeks ago, the company signed onto a pact with Mersana Therapeutics for two antibody-drug conjugate targets. Earlier in 2022, Merck bought into a duo of protein degradation deals. 

As for PDS, Wall Street appeared unexcited on the handoff, with shares slipping more than 14%, from $13.20 down to $11.31. The focus for the company remains PDS0101, which is also being paired with Keytruda to treat head and neck cancers and chemo and radiation to treat cervical cancer.