Merck & Co unit Merck Bioventures is tapping into Parexel's expertise in the biosimilars arena, entering into a strategic alliance with the contract research organisation to develop new candidates and speed their path to market.
The companies announced their new arrangement yesterday, but were reluctant to go into too much detail on the specifics of the deal.
Under the terms that were disclosed, Parexel will provide Merck Bioventures with strategic access to its clinical development services for certain broad classes of biosimilars in various therapeutic areas, including exclusivity for some.
The agreement also allows for the establishment of a dedicated Merck BioVentures unit within Parexel's walls, the companies said.
Explaining Merck's interest in the deal, Michael Kamarck, president of Merck BioVentures, said it "positions [the firm] for success with an industry leading partner that has the expertise and resources to conduct clinical development of our diverse portfolio of candidates to allow timely delivery of products to the marketplace". The move also fits with its intention - as stated in May last year - of having five biosimilars in late-stage development by 2012.
On Parexel's side, company chairman and chief executive Josef von Rickenbach said his group is "committed to working with Merck BioVentures to assist in advancing its biosimilar portfolio in this rapidly developing market segment for the benefit of patients worldwide".
According to UK research firm Biophoenix, developing a biosimilar for market takes up to eight years at an average cost of $100-$150 million. In 2009, sales of biosimilars were just $75 million worldwide compared to $110 billion generated by biologic drugs, but the market is growing rapidly and is expected to swell to more than $5.5 billion by 2013, with a growing number of companies seemingly keen to tap into this potential.
Both companies' stock inched up (less than 1%) following news of their partnership.