Ablynx said today it has expanded its nearly year-and-a-half-old immuno-oncology collaboration with Merck & Co. to address additional checkpoint modulator targets. The four-year expansion could generate an additional more-than-€4 billion (about $4.4 billion) in milestone payments for the Belgian biopharma.

Ablynx has agreed to oversee discovery and development for up to 12 additional cancer drugs based on single-domain antibody fragments, or Nanobodies®, through preclinical proof-of-concept.

After that, Merck will have the option to advance specific lead candidates. Merck will also be responsible for clinical development, manufacturing, and commercialization of any products resulting from the collaboration, Ablynx said.

The new Nanobody drugs will be developed against individual protein targets and target combinations.

In the expanded collaboration, Merck has agreed to pay Ablynx €13 million ($14.2 million) upfront consisting of exclusivity fees and FTE payments, as well as further research funding over the term of the collaboration.

Ablynx will also be eligible for additional exclusivity fees, depending on how many programs for which Merck exercises its licensing option, plus up to €340 million ($371 million) in payments tied to development, regulatory, and commercial milestones.

“This significant expansion of our collaboration with Merck after less than 18 months underlines the promise offered by our Nanobody platform in the discovery of unique new therapeutic agents,” Ablynx CEO Edwin Moses, Ph.D., said in a statement.

Ablynx and Merck launched their immuno-oncology collaboration in February 2014, agreeing to discover and develop five Nanobody candidates, including multi-specific Nanobody combinations. Ablynx received €20 million ($21.8 million) upfront, and was entitled to up to €10.7 million ($11.7 million) in research funding during the initial three-year research term—as well as up to €1.7 billion ($1.85 billion) in development, regulatory, and commercial milestone payments based on achieved sales thresholds.

The 2014 collaboration was the second launched by the companies. In October 2012, Merck agreed to pay Ablynx €6.5 million ($7.1 million) upfront, €2 million (about $2.2 million) toward research funding, and up to €448 million ($488.6 million) in research, regulatory and commercial milestone payments, plus tiered royalties, under a partnership to co-develop ion channel drugs based on Nanobodies.

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