Denmark-based Nuevolution has signed an exclusive licensing agreement with a subsidiary of Merck, for small molecule compounds targeting an undisclosed intracellular target for use as leads in Merck’s drug discovery and development.

As part of the deal, which is the second agreement between the two firms, Merck will obtain exclusive rights for the further development and commercialisation of the compounds.

For certain preclinical, clinical and agreed upon commercial milestones, Nuevolution will receive an undisclosed upfront payment and milestone payments.

In addition, Nuevolution is also eligible to receive royalties on the commercial sales of approved products.

The two firms have not disclosed further financial details of the agreement.

Nuevolution CEO Alex Gouliaev said the agreement is the first pre-clinical compound out-licensing agreement for the company.

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"It marks the immediate realisation of our chosen strategy to both offer access to our technology as well as out-license leads identified by the use of the Chemetics platform," Gouliaev said.

"We are very pleased to see that the compounds will be developed further by Merck."

The agreement allows Nuevolution to deliver on its new strategy to transform from a technology platform biotech company to a lead compound development company providing new products to enhance future health treatments of patients.

In order to identify small molecule drug candidates for therapeutically important targets, Nuevolution applies its Chemetics drug discovery technology that uses new DNA labelling to allow small molecule screening at an unprecedented scale for lead discovery.

According to the company, the technology allows efficient screening of billions of molecules against biological targets.

"It marks the immediate realisation of our chosen strategy to both offer access to our technology as well as out-license leads identified by the use of the Chemetics platform."

The company has patented its Chemetics technology and holds a large validated patent portfolio within the technology field.

Nuevolution chairman Stig Løkke Pedersen said: "The out-licensing of compounds represents the best future source of sustainable growth for the company.

"It is very encouraging to see existing partnerships develop into long term relationships."

Nuevolution partners its technology with pharmaceutical and biotechnology firms, and has entered into drug discovery agreements with Merck, Novartis, Boehringer Ingelheim, Cancer Research Technology and The Institute of Cancer Research.

In addition, Lexicon Pharmaceuticals, GlaxoSmithKline and Novartis have also signed technology licensing agreements with Nuevolution.

The company is also participating in a scientific joint venture consortium (Nuevolution, Duke University, Howard Hughes Medical Institute, Lexicon Pharmaceuticals) focusing on GPCR’s.

Currently, the company is in the optimisation phase for compounds identified under a joint venture consortium between Nuevolution, EpiTherapeutics, ExpreS2ion Biotechnologies and BRIC focusing on epigenetics.

Image: Chemetics represents the ultimate fragment, based drug discovery technology. Photo: courtesy of freedigitalphotos.net.