LLY - Lilly teams up with Merus to discover T-cell re-directing antibody therapies

Eli Lilly's (LLY) R&D group Loxo Oncology (LOXO) and Merus (MRUS) announce a research collaboration and exclusive license agreement that will leverage Merus' proprietary Biclonics platform along with the scientific and rational drug design expertise of Loxo Oncology (LOXO) at Lilly to research and develop up to three CD3-engaging T-cell re-directing bispecific antibody therapies. Under the terms of the agreement, Merus will lead discovery and early stage research activities while Loxo Oncology at Lilly will be responsible for additional research, development and commercialization activities.Merus will receive an upfront cash payment of $40M, an equity investment by Lilly of $20M in Merus common shares, up to $540M in milestones per product, for a total of up to ~$1.6B for three products, as well as tiered royalties ranging from the mid-single to low-double digits.LLY shares up 2.3%, MRUS +1.7% premarket.

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Lilly teams up with Merus to discover T-cell re-directing antibody therapies