ViewPoints: Nanobody know-how – Perlmutter returns to Ablynx as Merck & Co. steps up its collaborative efforts in immuno-oncology

Should anyone be that surprised that Merck & Co. is to team up with Ablynx in a bid to enhance its position in the immuno-oncology race?

The deal – announced Monday – intersects a number of notable trends and perhaps has a further sense of inevitability given the former position of Merck's R&D head Roger Perlmutter on the board of directors at Ablynx.

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Big Pharma's interest in European biotech companies continues to increase steadily, with a particular focus on the Benelux region. Belgium's Ablynx – fresh from a deal signed with AbbVie in September – has once again been tapped for its nanobody know-how, in this instance to help bolster Merck's immuno-oncology efforts.

Perlmutter has previously suggested that Merck's historical investment in biologics has underwhelmed, and it is no surprise that efforts to reverse this trend are focused around immuno-oncology.

The US pharma giant – in need of some sizeable R&D successes given a poor run of form with the FDA – finds itself competing near the front of this particular race; indeed, analysts have speculated that in MK-3475 the company may be in possession of the best in class PD-1 inhibitor product - ViewPoints: With something to prove, Merck & Co. comes out fighting in cancer immunotherapy race.

However, when comparisons are made to rival players Bristol-Myers Squibb and Roche, it is a lack of notable legacy in cancer drug development and a rather narrow portfolio that are cited as Merck's weaknesses. In contrast, Bristol-Myers Squibb has the breadth of portfolio (heavily shaped by its 2009 acquisition of Medarex), while Roche has the prestige factor (and a head start in personalised cancer treatments), which stem from its long-relationship with Genentech.

No surprises then to see Perlmutter expand the reach of his immuno-oncology development by returning to Ablynx, where he was appointed to the board of directors for a six-month period after he left his position as head of R&D at Amgen in 2012.

This brief sojourn may ultimately prove to be fruitful for all involved, particularly given the deal could be worth up to $2.3 billion for Ablynx. "Multiple relationships with senior management at Merck" certainly played a part in accelerating the signing-off of the collaboration once terms were agreed, Edwin Moses – CEO at the Belgian company – confirmed to FirstWord.

Ablynx played down any suggestion that it has limited its options for further immuno-oncology deals in order to secure a collaboration that is heavily 'back-weighted' in terms of payments. Moses confirmed to FirstWord not only that there has been dialogue with other various industry leaders but cited "a large number of targets and combinations" where Ablynx could work on its own or with other partners.

Quite what these targets and combinations are remains unclear, as Ablynx is giving little away at present about the specific details of its collaboration with Merck, playing down speculation that it will be working to develop an anti-PD-1/CTLA4 'duobody.'

Indeed, a lack of disclosure saw the deal have muted impact on Ablynx's share price during trading on Monday, despite the high level of buzz which surrounds immuno-oncology at present.

At Merck, investors are starting to believe that MK-3475 could return the pharma giant to the promised land. Since his appointment last year, Perlmutter has certainly bought a healthy dose of momentum to the company's R&D endeavours; with this deal he appears to have delivered a personal touch.

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