Lycera Enters Into Second Collaboration Deal with Merck

Lycera, the biopharmaceutical company based in Plymouth, MI, announced today that it is entering into a second collaboration agreement with pharmaceutical giant Merck. This is the second collaboration deal between Lycera and Merck in two years.

Merck will spearhead clinical development and will have worldwide marketing and commercialization rights to any products that are developed as a result of the collaboration. Lycera will receive several million in upfront cash for research funding and is eligible to receive royalty payments, as well as development and sales milestones worth up to $300 million, on global sales from any such products.

“This is everything I could have wished for when I took the CEO position,” says Kathleen Metters, a former senior vice president and head of worldwide basic research at Merck who took the job leading Lycera in the fall of 2011. “The second collaboration really speaks to the success of our first collaboration. Merck recognizes the productivity and innovation of the Lycera team and has judged that we’re an ideal partner.”

Lycera is working to develop oral medicines to treat autoimmune diseases like rheumatoid arthritis and psoriasis. The collaboration with Merck involves developing and commercializing small-molecule therapies. Metters says these therapies are gaining traction clinically, giving Lycera reason to believe it’s on to something big—a notion validated by Merck’s interest and investment.

Metters says developing therapies to treat the spectrum of autoimmune diseases is an “unmet medical need” with approximately 50 million people in the United States alone suffering from an autoimmune disease. The second collaboration with Merck involves science completely different from that of the first round, Metters explains, though it will incorporate what has been learned thus far.

Lycera also has a series of proprietary projects underway, coming out of the work of founder Gary Glick, that will transition to clinical development over the next 12 to 18 months, Metters says. The lead program explores ways to target autoimmune disease-causing cells while keeping healthy cells intact, meaning the therapy is better tolerated by the body than traditional immunosuppressants and leads to fewer opportunistic infections as a result.

In 2010 and 2011, Lycera went through a big hiring expansion, and Metters says Lycera will continue to grow its staff by approximately 10 percent in the coming year. Right now, the Lycera team in Ann Arbor numbers about 25. Metters has also been very impressed with the local scientific environment and expertise in Ann Arbor, as well as the state-of-the-art University of Michigan North Campus Research Complex where Lycera has laboratories.

“This is a really exciting time for the company,” she adds. “We believe this new collaboration with Merck really validates Lycera and the culture of scientific excellence we bring, and that’s highly motivating to our employees.”

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