German and British drugmakers Merck KGaA and Glaxo SmoithKline have entered a global strategic alliance to jointly develop and commercialize M7824 (bintrafusp alfa), the German group’s investigational bifunctional fusion protein immunotherapy currently in clinical development.

The cooperation will extend to multiple potential registration studies for multiple difficult-to-treat cancers. A phase II trial will investigate M7824 compared with pembrolizumab as a first-line treatment in patients with PD-L1 expressing advanced non-small cell lung cancer (NSCLC).

Altogether, the project will include eight high priority immuno-oncology clinical development studies that are either ongoing or expected to begin this year. All profits and costs from the collaboration will be shared by the partners equally on a global basis.

With the alliance, both companies expect to have the leadership position in this new class of immunotherapies, specifically leveraging TGF-β biology.

Merck said the collaboration reflects its strategic approach to oncology R&D, identifying opportunities that can progress its “highly promising” clinical stage assets as efficiently and rapidly as possible, whether through internal expertise and capabilities or external collaborations.

In addition to an upfront payment of €300 million, Merck will be eligible for potential development milestone payments of up to €500 million triggered by data from the M7824 lung cancer program. Future approval and commercial milestones could add as much as €2.9 billion for a total potential deal value of up to €3.7 billion.

For forward development of the drug, “GSK clearly emerged as the ideal partner due to their strong commitment to oncology and the complementary talent and capabilities they will bring to our alliance,” said Belén Garijo, member of the executive board and CEO Healthcare at Darmstadt-based Merck.

“Together with GSK we aim to drive a paradigm shift in the treatment of cancer as the leader in this novel class of immunotherapies,” Belén said, adding that “M7824 has the potential to bring new answers to patients living with cancer.”

For GSK, the alliance represents “a further step” in its priority to strengthen its pharmaceuticals pipeline, following the recent acquisition of TESARO, an oncology-focused company based in Waltham, Massachusetts, USA, the company said.  The UK drugmaker’s current oncology platform is focused on immuno-oncology, cell therapy, cancer epigenetics and, most recently, genetic medicine.

 “Despite recent medical advances, many patients with difficult-to-treat cancers don’t currently benefit from immuno-oncology therapies leaving them with limited treatment options,” Hal Barron, chief scientific officer and president R&D at GSK, remarked.

“M7824 brings together two different biological functions in a single molecule and we have observed encouraging clinical results in treating certain cancer patients, particularly those people with non-small cell lung cancer,” Barron said.

Specifically, the Merck development candidate is designed to simultaneously target two immuno-suppressive pathways, transforming growth factor-β (TGF-β) trap and an anti-programmed cell death ligand-1 (PD-L1), which are commonly used by cancer cells to evade the immune system.

Bifunctional antibodies are designed to increase efficacy beyond that achieved with individual therapies or combinations of individual therapies. In addition to use as a single agent, M7824 is also being considered for use in combination with other assets from the pipelines of both companies.