Merck & Co. announces $600-million licensing agreement for Cardiome's vernakalant

Merck & Co. and Cardiome announced that the companies entered into a development and licensing agreement over Cardiome's investigational atrial fibrillation drug vernakalant, in a deal worth as much as $600 million for Cardiome. The deal gives Merck exclusive worldwide rights to the oral formulation of the compound for the maintenance of normal heart rhythm in patients with atrial fibrillation, as well as exclusive rights outside North America for the drug's intravenous formulation for rapid conversion of atrial fibrillation to normal heart rhythm.

Under the terms of the collaboration, Merck will make an initial payment of $60 million to Cardiome, which will also be eligible to receive up to $200 million in milestones associated with vernakalant's development and potential approval. Merck will also pay up to $340 million in sales-related milestones for the drug, if approved, as well as tiered royalties on sales of products that reach market. The US drugmaker will assume responsibility for all future costs associated with the development, manufacturing and marketing of the drug candidates. In addition, Cardiome retains an option to co-promote oral vernakalant in the US with Merck, and Merck granted the company a credit facility of up to $100 million.

The two companies noted that an existing agreement between Cardiome and its North American co-development partner Astellas, covering the intravenous formulation of vernakalant in the US, Canada and Mexico, is not impacted by the deal. In August 2008, the FDA issued an approvable letter to Astellas and Cardiome requesting additional safety information for the intravenous formulation, known as Kynapid, which is currently under review by the agency.

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