Teaming up on next-gen growth hormone products

SAN DIEGO—Ambrx has high hopes that a recently announced collaboration with Merck Serono to develop and commercialize Ambrx's long-acting growth hormone products will mean much more than just milestone payments and royalties—indeed, the company feels the deal can give it some seriously boosted cachet in the market, perhaps even in the stock market one day.

The deal itself is fairly straightforward, focusing initially on the development of ARX201, the most advanced Ambrx product candidate, which is currently in Phase I/II clinical trials. ARX201 is said to have pharmacological properties that should allow less frequent administration than the daily dosing regimens of currently available growth hormones.

Under the terms of the agreement, Merck Serono receives worldwide commercialization rights for ARX201. Merck Serono will make an initial payment to Ambrx, and Ambrx also is eligible to receive clinical, regulatory and commercial milestone payments based on development and commercialization of products, as well as royalties on net sales. Exact figures for those milestone payments and royalties remain undisclosed.

"In addition, we do have the potential for co-promotional rights for the U.S. market, where Ambrx would contribute to Phase III programs and thus have ability to get larger percentage of net sales in the United States," notes Dr. Ho Sung Cho, VP of technology and process development for Ambrx. "That would be very favorable in terms of our future business."

But Cho sees the deal as having even more significance long-term, calling the collaboration a "step up" from a research collaboration with Roche more than a year ago. That deal was more research oriented, whereas this one is a deal with a major player for products already in the clinical stage.

"It's still not clear whether Ambrx will do an IPO in the near future," Cho says, "but if we were to choose that route, a deal like this and all its implications would position us well in terms of public valuation, I think."