Merck & Co. has quickly recouped some of the costs of its Harpoon Therapeutics buyout, pulling in $170 million upfront by incorporating the lead candidate into a co-development deal with Daiichi Sankyo.
The deal flips the flow of assets between Merck and Daiichi. In October 2023, Merck paid Daiichi $4 billion to partner on a slate of antibody-drug conjugates. This time around, Daiichi is the buyer and Merck is the seller. Daiichi is paying $170 million to split the costs and profits of developing a T-cell engager outside of Japan, where Merck retains exclusive rights and its partner will receive a sales-based royalty.
Daiichi is buying into the development of MK-6070, a trispecific T-cell engager that Merck acquired when it bought Harpoon for $650 million earlier this year. MK-6070, formerly known as HPN328, is designed to bind CD3 on T cells and DLL3 on tumor cells. The third domain binds albumin to extend the half-life.
DLL3 is expressed in more than 70% of small cell lung cancers (SCLCs). The original deal between Merck and Daiichi included ifinatamab deruxtecan, a B7-H3-directed ADC that recently entered phase 3 in SCLC. Merck and Daiichi plan to study the ADC and trispecific in combination in some SCLC patients.
Dean Li, M.D., Ph.D., president of Merck Research Laboratories, outlined the importance of SCLC to the company at a Goldman Sachs event in June. Immuno-oncology agents have improved outcomes in non-SCLC, Li said, but are yet to make a mark on SCLC, with Merck withdrawing an accelerated approval for Keytruda in the setting. The Harpoon acquisition and first Daiichi deal are part of a push to crack SCLC.
“We just think there's a lot of opportunity in small cell lung cancer,” Li said. “It's not just the Harpoon asset. It's also our collaboration with Daiichi Sankyo, where B7-H3 is focused in small cell lung cancer. We think there is great opportunity to move the needle of small cell lung cancer, similar to how we've moved the needle for non-small cell lung cancer.”
The expanded Daiichi deal now joins Merck’s attempt to move the needle in SCLC. MK-6070 is currently in a phase 1/2 trial.
Amgen has a rival DLL3 candidate, tarlatamab, in phase 3 but lacks the combination opportunities the Daiichi deal presents to Merck.