- Merck & Co. has licensed two neurodegenerative disease drugs from privately held Yumanity Therapeutics, a startup co-founded six years ago by ex-Onyx Pharmaceuticals CEO Tony Coles and decorated researcher Susan Lindquist, who died in 2016.
- Yumanity could get as much as $500 million from Merck, including an unspecified upfront payment, through the deal. Merck is also investing in a Series C funding round for the biotech.
- Merck is best known for its work in cancer, infectious disease and diabetes. But neuroscience remains an area of interest for Merck, even as it has pared back its investment in the field.
Merck's top-selling products are the cancer immunotherapy Keytruda, the diabetes medicine Januvia and the HPV vaccine Gardasil, which collectively generated about 43% of its $46 billion in sales last year.
The company has kept an eye on neuroscience, a field in which it is notoriously difficult to successfully develop drugs. Biological mystery and confounding placebo effects in human trials have waylaid even the most promising candidates, something Merck experienced firsthand in 2017 when its Alzheimer's pill verubecestat failed a Phase 3 study.
Merck has kept its research footprint in neuroscience small, however. In 2015, for instance, the drugmaker sold its migraine drug research to Allergan, work that led to an approved migraine medicine, Ubrelvy, now owned by AbbVie. Merck only has one marketed neuroscience drug, the insomnia treatment Belsomra, and just one other program, for schizophrenia, in human trials.
The company has instead turned to deals to keep its neuroscience options open. A $576 million buyout of San Diego biotech Calporta Therapeutics last year gave it technology to develop potential medicines for Alzheimer's, Parkinson's and ALS. An alliance with Almac Discovery was also focused on research that could yield neurodegenerative drugs. Now it's adding two more programs through a deal with Yumanity.
The alliance is the first with a large drugmaker for Yumanity. The company launched in 2014 based on the work of Susan Lindquist, a National Medal of Science winner who founded FoldRx, which Pfizer acquired in 2010. As with FoldRx, Yumanity's research centers around misfolded proteins, Lindquist's expertise.
The company uses genetically modified yeast and human neurons to probe for biological markers of neurodegenerative diseases like Alzheimer's and Parkinson's. The idea is this type of drug screening might reveal more reliable ways to successfully develop treatments.
Yumanity was originally led by Tony Coles, who sold Onyx Pharmaceuticals to Amgen for $10 billion. Lindquist and Coles bootstrapped Yumanity for a few years before getting the backing of Fidelity and others in 2016, the year Lindquist passed away.
In 2019, Coles became Yumanity's executive chairman and the CEO of a different neuroscience startup, Cerevel Therapeutics. Coles handed the reins at Yumanity to another former Onyx executive, Richard Peters, but remains Yumanity's chairman.
Yumanity began its first human trial last year, testing a Parkinson's drug called YTX-7739. Another drug, for Lewy body dementia, could start a Phase 1 trial next year.
The Merck partnership doesn't include either of those drugs, and is instead based on early research programs for amyotrophic lateral sclerosis, or ALS, and frontotemporal dementia. Merck and Yumanity will team up on preclinical research, though the big drugmaker will take the lead if any programs advance to clinical trials.