Multimillion-dollar partnership covers antibodies, protein therapies, and small molecules.

OncoMed Pharmaceuticals will receive $40 million up front from Bayer Schering Pharma in an alliance targeting the Wnt signaling pathway. The Wnt signaling pathway has been identified as an important target in halting cancer stem cell activity.

The collaboration includes OncoMed’s lead antibody, OMP-18R5, which is currently planned to enter clinical testing in 2011. The firms will work to develop additional antibodies, protein therapeutics, as well as small molecules.

The partnership could include up to five compounds. For each biotherapeutic successfully developed through Phase III trials and regulatory approval, OncoMed’s payments could total up to $387.5 million, including sales milestones. In addition, the company will be eligible to receive double-digit royalties on net product sales. The agreement also contains provisions under which OncoMed may co-develop antibody and protein therapeutics with Bayer.

OncoMed will utilize its human cancer stem cell models to discover and advance antibody and protein therapeutics through Phase I clinical studies. Bayer Schering Pharma receives an option to exclusively license antibody and protein therapeutic candidates at any point up to the completion of Phase I testing.

Additionally, Bayer will lead the discovery and advancement of small molecule therapeutic candidates that modulate the Wnt pathway signaling. OncoMed could receive milestone fees of up to $112 million per candidate with successful development, regulatory approval, and commercialization. OncoMed will also be eligible to receive single-digit royalties on net product sales.

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