Daiichi Sankyo shares
4568,
rose sharply after the Japanese drugmaker announced a multibillion dollar deal with Merck
MRK,
to jointly develop and commercialize three cancer drug candidates.
The shares were recently 12% higher at 4,021 yen after rising as much as 18% earlier.
Daiichi Sankyo said Friday that it would receive $4 billion upfront from the U.S. drugmaker and $1.5 billion additionally over the next two years as part of the agreement. The Japanese company could also receive up to $16.5 billion if future sales milestones are achieved.
The Japanese and U.S. drugmakers will jointly develop and potentially commercialize three of Daiichi Sankyo’s lung and ovarian drug candidates worldwide, except in Japan where Daiichi Sankyo will maintain exclusive rights, they said.
The three drug candidates — patritumab deruxtecan, ifinatamab deruxtecan and raludotatug deruxtecan — are in various stages of clinical development.
Daiichi Sankyo said it would announce the impact of the Merck deal on its earnings at an appropriate time in the future.
For the fiscal year ending March 2024, the Japanese drugmaker had projected revenue would increase 13% to 1.450 trillion yen ($9.68 billion) and net profit to climb 5.3% to Y115.00 billion. The company is scheduled to announce its first-half results on Oct. 31.
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