MS and NSCLC targeted

GENEVA, Switzerland—Merck Serono and Ono Pharmaceutical Co.Ltd. of Osaka, Japan, have signed two separate agreements to strengthen Merck'smultiple sclerosis (MS) and cancer franchises.

The first license grants Merck worldwide exclusive rights(except in Japan, Korea and Taiwan) for the development and commercializationof ONO-4641, a novel investigational sphingosine-1- phosphate (S1P) receptormodulator currently in Phase II trials. The compound was originally discoveredand developed by Ono for the potential treatment of multiple sclerosis. Underthe terms of the agreement, Ono will receive about $20 million as an upfrontpayment. In addition, Ono could receive additional payments based on theachievement of certain development, regulatory and commercial milestones. Nofurther financial terms were disclosed.

"Merck Serono is committed to building on our leadershipfranchise in multiple sclerosis and we are excited about adding a potentialoral treatment, ONO-4641, to our pipeline," says Dr. Stefan Oschmann, presidentof Merck Serono. "We also believe that Ono will bring a wealth of experience indeveloping innovative therapies and understanding

regulatory requirements in Japan."

MS is a chronic, inflammatory condition of the centralnervous system and is the most common, non-traumatic, disabling neurologicaldisease in young adults. It is estimated that approximately two million peoplehave MS worldwide. While symptoms can vary, the most common include blurredvision, numbness or tingling in the limbs and problems with strength andcoordination. The relapsing forms of MS are the most common.

The second license agreement provides Ono withco-development and co-marketing rights in Japan for Stimuvax (BLP25 liposomevaccine), an investigational cancer therapeutic designed to stimulate thebody's immune system to target cancer cells that express the tumor antigenMUC-1. Under the terms of this agreement, Ono will pay Merck nearly $7 millionas an upfront payment.

Merck Serono is investigating the use of Stimuvax in thetreatment of non-small cell lung cancer (NSCLC). Merck Serona's parent, MerckKGaA, obtained the exclusive worldwide licensing rights from Seattle-basedOncothyreon Inc. Stimuvax is being developed in Europe by Merck Serono. In theUnited States and Canada, Stimuvax is being developed by EMD Serono, anaffiliate of Merck.

The START study is a Phase III, multi-center, randomized,double-blind, placebo-controlled clinical trial designed to evaluate theefficacy, safety and tolerability of Stimuvax in subjects suffering fromunresectable, stage IIIA or IIIB NSCLC who have had a response or stabledisease after at least two cycles of platinum-based chemo-radiotherapy. Thestudy will involve more than 1,500 patients in approximately 30 countries. Theprimary endpoint of the START study is overall survival (OS). The almost identicalINSPIRE study is designed to evaluate the efficacy, safety and tolerability ofStimuvax in approximately 420 unresectable, stage III NSCLC patients acrossChina, Hong Kong, Korea, Singapore and Taiwan.

"We are very glad to partner with Merck Serono for thedevelopment and marketing of ONO-4641, given Merck Serono's commitment todeveloping treatments for people living with multiple sclerosis," says GyoSagara, Ono's president and representative director. "Moreover, we aredelighted to collaborate in Japan on Stimuvax and, together with Merck Serono,to offer a potential future medicine for people suffering from non-small celllung cancer."

Merck Serono is the biopharmaceutical division of MerckKGaA, Darmstadt, Germany. In the United States and Canada, EMD Serono operatesas a separately incorporated affiliate of Merck Serono. With an annual R&Dexpenditure of about $1.4 billion, Merck Serono focuses on neurodegenerativediseases, oncology, fertility and endocrinology, as well as new areas potentiallyarising out of research and development in rheumatology. The Merck family holdsan approximately 70 percent interest in Merck KGaA. In 1917, the U.S.subsidiary Merck & Co. was expropriated and has been an independent companyever since.