US protein engineering company Codexis has completed wave 1 of the transfer of its proprietary CodeEvolver platform technology to compatriot drug maker Merck.

Under the agreement between the two US firms, signed in August of this year, Merck will have the right to use CodeEvolver to develop novel enzymes for use in the manufacture of its pharmaceutical products. To this end it provided the drugmaker with enzyme libraries and kits, screening tools, laboratory designs and equipment specifications.

Codexis received a $5 million upfront payment from Merck in August and is eligible to receive an additional $8 million milestone payment subject to the satisfactory completion of wave 2 of the technology transfer process.

The protein engineering firm also will be eligible to receive payments of up to $15 million for each commercial active pharmaceutical ingredient manufactured by Merck using one or more novel enzymes produced through the CodeEvolver technology.

“Licensing our CodeEvolver technology allows us to monetize our protein engineering technology while we continue to provide services and supply products to customers under our traditional business model,” said Codexis president and CEO John Nicols.

The CodeEvolver platform technology is covered by more than 175 issued patents and pending patent applications worldwide.