Under the terms of the agreement, Lundbeck will receive an initial payment of US $70 million and up to US $200 million in additional milestone payments. Merck and Lundbeck will jointly complete the ongoing Phase III clinical program, with Merck funding the majority of the remaining development activities. The parties anticipate that Merck will file an NDA with the U.S. Food and Drug Administration (FDA) between late 2006 and mid-2007. Following FDA approval, the companies plan to co-promote gaboxadol in the United States.
Lundbeck will receive a share of gaboxadol sales in the United States. "We are delighted to have reached an agreement with one of the strongest global players in central nervous system research," said Dr. Peter S. Kim, president of Merck Research Laboratories. "In the past 50 years, Lundbeck has demonstrated an impressive track record of developing new and innovative compounds for CNS disorders.
"We believe gaboxadol can be an important new option for the treatment of sleep disorders, which negatively impact the lives of millions of Americans. Gaboxadol has an entirely novel mechanism of action, which we believe could have substantial benefits over existing therapies. Merck is committed to the development of treatments for unmet medical needs through pursuit of novel therapies, such as gaboxadol," Dr. Kim added.
"We are very pleased to have been selected by Lundbeck as their partner of choice for this important project," said Dr. Merv Turner, senior vice president of Worldwide Licensing and External Research at Merck Research Laboratories. "Merck's development expertise coupled with that of Lundbeck makes for a winning combination. This agreement is an example of the increased emphasis that we are putting on complementing our internal research efforts with external licensing of novel therapies that address true medical needs."
According to the National Institutes of Health (NIH), more than 40 million Americans experience chronic, long-term sleep disorders each year, while 20 million more experience occasional sleep problems. Sleep disorders and the resulting sleep deprivation interfere with work, driving and social activities. Sleep disorders are responsible for an estimated $16 billion in medical costs each year, with additional costs attributed to lost work and other factors.
Under the terms of the agreement, Lundbeck will co-promote gaboxadol to psychiatrists and other specialists who treat sleep disorders. In order to facilitate Lundbeck's CNS-focused commercial entry into the United States, the agreement includes an option for Lundbeck to co-promote a Merck product prior to the launch of gaboxadol.
"The combination of Merck's strong development and marketing capabilities and its highly sophisticated sales force makes us confident that we have found the best partner for gaboxadol," said Dr. Claus Braestrup, president and CEO of Lundbeck. "This agreement also provides a unique opportunity for Lundbeck to build a commercial presence in the United States, with the support of a strong partner."
Gaboxadol, a direct-acting GABA-A receptor agonist, is expected to be the first product launched in the class. It has a mode of action different from that of benzodiazepine receptor ligands presently on the market or nearing launch. Gaboxadol interacts directly with the GABA receptor recognition site and mediates its effects via a GABA receptor population that is different from that modulated by benzodiazepine ligands. In clinical trials, gaboxadol has shown sleep-inducing as well as sleep-maintaining properties, resulting in improvements in sleep architecture.
The compound's novel mode of action is expected to yield a minimal risk of abuse, which may provide a competitive advantage in the market.
About H. Lundbeck A/S
H. Lundbeck A/S is an international pharmaceutical company engaged in the research, development, production, marketing and sale of drugs for the treatment of psychiatric and neurological disorders. In 2002, the company's revenue was DKK 9.5 billion. The number of employees is approximately 5,600.
About Merck & Co., Inc.
Merck & Co., Inc. is a global research-driven pharmaceutical products company. Merck discovers, develops, manufactures and markets a broad range of innovative products to improve human and animal health, directly and through its joint ventures.
H. Lundbeck A/S Forward-Looking Statement
The content of this release will have no influence on the Lundbeck Group's expectations for the financial result for 2003, which will be presented on March 10, 2004, together with the company's financial expectations for the year 2004.
Merck Forward-Looking Statement
This press release contains "forward-looking statements" as that term is defined in the Private Securities Litigation Reform Act of 1995. These statements involve risks and uncertainties, which may cause results to differ materially from those set forth in the statements. The forward-looking statements include statements regarding product development. No forward-looking statements can be guaranteed, and actual results may differ materially from those projected. Additional detailed information concerning a number of factors that could cause actual results to differ materially is available in Item 1 of Merck's Annual Report on Form 10-K for the year ended Dec. 31, 2002, in its periodic reports on Form 10-Q and in its reports on Form 8-K (if any). Copies of these forms are available on request to Merck's Office of Stockholder Services.