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Astrazeneca Enters into Agreement with Merck

This is an ongoing partnership that includes the joint development of the drug with AstraZeneca`s checkpoint inhibitor Imfinzi, a fourth treatment that narrowly failed in a lung cancer combination study, and Merck`s Keytruda, which is among the best drugs in the same class. Selumetinib, a MEK inhibitor, and related combinations of AstraZeneca also occur. The collaboration aims to maximize the potential of PARP and MEK inhibitors in combination with PD-L1/PD-1 drugs, based on growing scientific evidence that these combinations offer new potential for the treatment of a number of tumor types under the agreement, Merck will pay AstraZeneca a total of up to $8.5 billion, including $1.6 billion in advance. $750 million for certain licensing options and up to $6.15 billion depending on the success of future regulatory and commercial steps. Under the terms of the agreement, AstraZeneca plans to report approximately $1 billion in outsourcing revenue in 2017. Merck will fund all development and commercialization costs of Keytruda in combination with Lynparza or selumetinib. AstraZeneca will fund all development and commercialization costs of Imfinzi in combination with Lynparza or selumetinib. The Lynparza pipeline has grown significantly in recent years, with 14 indications being developed for various types of tumors, including breast, prostate and pancreatic cancer. Strategic collaboration is expected to further increase the number of treatment options available to patients. For more information on our oncology clinical trials, see www.merck.com/clinicaltrials. WeE1 helps regulate the cell division cycle. The INHIBITOR DEE1 MK-1775 is designed to cause the division of certain tumor cells without going through the normal processes of DNA repair, ultimately leading to cell death.

Preclinical evidence suggests that the combination of MK-1775 and DNA-damaging chemotherapy drugs may improve antitumor properties compared to chemotherapy alone. Selumetinib is also being tested in a separate Phase II study in patients with pediatric neurofibromatosis type 1 and in a Phase I study in patients with advanced solid tumors. Meanwhile, AstraZeneca is looking to expand the approval of Lynparza in ovarian cancer, thanks to positive data for its tablet formulation in a wider patient population. In patients who had relapsed, Lynparza stopped recurrence for more than two years compared to placebo. Financial Considerations Under the terms of the agreement, AstraZeneca and Merck will share the costs of developing and commercializing Lynparza monotherapy and selumtinib, as well as PD-L1/PD-1-free combination therapy options. Gross profit from sales of Lynparza and selumetinib products generated by monotherapies or combination therapies will be divided equally. AstraZeneca presented this partnership as a way to expand Lynparza`s reach by collecting new indications and developing combination cocktails. Keytruda finally zoomed in on blockbuster status, and the combination of this PD-1 drug with the AstraZeneca PARP inhibitor could bind Lynparza to these coat tails. The Company assumes no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise. Other factors that could cause results to differ materially from those described in the forward-looking statements can be found in the Company`s 2016 Annual Report on Form 10-K and in the Company`s other filings with the Securities and Exchange Commission (SEC), which are available on the SEC`s website (www.sec.gov). Kenneth C.

Frazier, President and CEO of Merck, said: “This global collaboration between AstraZeneca and Merck, two leading oncology companies, will increase the possibilities for patients to have more treatment options for more cancers. Merck continues to expand its leadership position in immuno-oncology with Keytruda as the basis for monotherapy and combination therapy, and this collaboration extends our leadership position in oncology to the growing targeted therapies of PARP and MEK inhibitors. We look forward to working with AstraZeneca to create more value for patients and shareholders than if the two companies operated independently. However, the compromise is obvious. AstraZeneca is dropping half of a promising drug that could pay off on all levels, provided it can fend off competition from tesaro and Clovis Oncology`s new PARP drugs. Tesaro`s competition could become tougher; It is on the block and could be taken over by a major drug manufacturer with more marketing know-how. “MK-1775 is an important addition to AstraZeneca`s growing oncology portfolio, which already includes a number of DNA damage response inhibitors,” said Susan Galbraith, Head of AstraZeneca`s Innovative Oncology Medicines Unit. “The compound has shown encouraging clinical efficacy data and we intend to study it in a number of cancers where there is a high unmet medical need.” “Merck is committed to advancing potentially meaningful treatment options for cancer patients in a timely manner,” said Iain D. Dukes, senior vice president and head of licensing and external scientific affairs at Merck. “We are pleased to enter into this agreement with AstraZeneca to realize the potential of MK-1775 as we focus on advancing our late-stage oncology programs, MK-3475 and Vintafolid.” The cooperation agreement was concluded with the signature on 26 July 2017.

We are figuring out how AstraZeneca can do without half of it. Merck & Co. acquired half of Lynparza`s rights in an $8.5 billion transaction, including $1.6 billion in advance and the rest depends on revenue and regulatory milestones, as well as potential royalty payments worth up to $750 million. “We are excited about our strategic collaboration with Merck, which will maximize Lynparza`s potential as the backbone of many combinations,” Pascal Soriot, CEO of AstraZeneca, said in a statement. The cancer drug Lynparza was one of AstraZeneca`s biggest hopes amid generic competition for its successful statin Crestor and uneven pipeline results. What would the company do without them? AstraZeneca and Merck to Independently Develop and Commercialize LYNPARZA and the potential drug selumetinib in combination with their respective immuno-oncology drugs pd-L1/PD-1 IMFINZI and KEYTRUDA The Company recently announced positive results from its Phase III OlympiAD study for Lynparza, which showed a statistically significant and clinically significant improvement in progression-free survival in patients using Lynparza tablets (300 mg twice daily). compared to treatment with medical choice of standard chemotherapy. OlympiAD, a randomized, open-label, multicenter Phase III study evaluating the efficacy and safety of Lynparza in patients with HER2-negative metastatic breast cancer with BRCA1 or BRCA2 mutations in the germline that are predicted or suspected to be harmful, was the first positive Phase III study evaluating the efficacy and safety of PARP inhibitors beyond ovarian cancer. Lynparza is currently being studied in another separate phase III study in non-metastatic breast cancer called OLYMPIA. This study is still open and recruits patients internationally. About AstraZeneca AstraZeneca is a science-based global biopharmaceutical company focused on the discovery, development and commercialization of prescription drugs, primarily for the treatment of diseases in three main therapeutic areas: oncology, cardiovascular and metabolic diseases, and respiratory diseases. The company also operates selectively in the areas of autoimmunity, neuroscience and infections.

AstraZeneca is present in more than 100 countries and its innovative medicines are used by millions of patients worldwide. For more information, please visit www.astrazeneca.com and follow us on Twitter @AstraZeneca. Under the terms of the agreement, AstraZeneca will make an upfront payment of $50 million to Merck. In addition, Merck is entitled to future payments related to development and regulatory milestones, as well as revenue payments and tiered royalties. AstraZeneca will be responsible for all future clinical developments, manufacturing and commercialization. As part of its cancer focus, Merck is committed to exploring the potential of immuno-oncology with one of the fastest growing development programs in the industry. We are currently conducting an extensive research program that includes more than 500 clinical trials of our anti-PD-1 therapy in more than 30 tumor types. In addition, we continue to strengthen our immuno-oncology portfolio through strategic acquisitions and prioritize the development of several promising immunotherapeutic candidates with the potential to improve the treatment of advanced cancers. In addition, Merck will bear much of the costs associated with expanding Lynparza`s regulatory list, not to mention the launch of selumtinib. He will cover half of the expenses for the development and commercialization of Lynparza and selumetinib as solo therapies. AstraZeneca will cover the cost of testing Lynparza with Imfinzi and selumetinib, and Merck will do the same for similar combinations of Keytruda. WEE1 is a cell cycle checkpoint protein regulator.

Preclinical data suggest that disruption of EED1 may enhance the cell-destroying effects of some anticancer drugs. MK-1775 is an orally available inhibitor of the WEE1 cell cycle checkpoint protein under study. Mk-1775 is being studied in Phase IIa clinical trials for the treatment of patients with P53-deficient ovarian cancer. The companies will jointly develop and commercialize Lynparza, both as monotherapy and in combination with other potential drugs. .

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