Paying the toll for vaccines

CAMBRIDGE, Mass.—IderaPharmaceuticals' Toll-like Receptor (TLR) agonists could be seeing some majorcommercial exposure following a recent collaboration deal between the companyand Merck & Co. AS part of the deal, the companies will research, developand commercialize the TLR agonists by incorporating them in therapeutic andprophylactic vaccines being developed by Merck for oncology, infectiousdiseases and Alzheimer's disease.

Under the terms of the agreement, Merck will receiveworldwide exclusive rights to a number of Idera's agonist compounds targetingTLR 7, 8 and 9 for use in combination with Merck's vaccines. In addition, Merckand Idera will engage in a two-year research and development collaboration togenerate novel agonists targeting TLR 7 and TLR 8 and incorporating both Merckand Idera chemistry for use in the licensed fields.

Idera already has a substantial portfolio of TLR 9-relatedcompounds that it is exploring, according to Sudhir Agrawal, Idera's CEO, whichis why the research and development aspect of the deal focuses just on TLR 7and TLR 8. Idera has two compounds in clinical trials now—IMO-2055 for oncologyand Amplivax for prevention and treatment of HIV. The company has also donepreclinical work on compounds showing activity in oncology treatmentcombinations (chemotherapy, monoclonal antibodies, radiation), infectiousdisease and vaccine adjuvants, as well as a trials for asthma and allergy inpartnership with Novartis.

"The deal with Merck is incredibly important to help usfurther develop our internal pipeline," notes Bob Karr, Idera's president. "Butit is important to note that it covers only the use of TLRs for vaccinesrelated to oncology, infectious disease and Alzheimer's. The potential for TLRsis much more broad, going beyond just vaccines, and we retain all rights forthose other programs and areas."

Merck has agreed to pay an upfront license fee of $20million to Idera and to purchase $10 million of its common stock at $5.50 pershare. In addition, Merck will fund the research and development collaboration.Idera is eligible to receive milestone payments of up to $165 million ifvaccines are successfully developed in each of the three fields. Additional milestones of up to $260 millionwould be payable for follow-on indications in the oncology field and thesuccessful development of additional vaccines containing Idera's TLR agonists.

"TLRs are critical mediators of the human immune response.We believe a chemistry-based approach may be an efficient way to harness theactivity of TLRs to train the immune system to recognize antigens, therebypotentially enhancing the effect of vaccines," says Dr. Stephen H. Friend,executive vice president of Advanced Technologies and Oncology at Merck. "[Iderahas] established a robust TLR-based discovery platform that is synergistic withour internal chemistry programs and has yielded an extensive portfolio of TLRagonist compounds that can be applied across our multiple areas of interest fornew vaccine development." According to Idera, TLRs function in human immunecells as the sensors of pathogens. Theyrecognize different microbial products present in pathogens such as bacteria,viruses and parasites, and mount an appropriate immune response against theforeign invaders. TLRs have become attractive targets for developing immunemodulators to treat a number of diseases, including cancer, asthma, allergies,and infectious diseases.