UPDATE 1-Ariad says partner Merck to acquire cancer treatment
* Ariad to receive $50 mln upfront payment from Merck
* Says Merck will have developing and marketing rights
* Ariad shares up 9 pct pre-market
May 5 (Reuters) - Ariad Pharmaceuticals Inc (ARIA.O) said its partner Merck & Co Inc (MRK.N) will acquire all development and marketing rights of their experimental cancer treatment, ridaforolimus.
As per the agreement, Ariad will receive an upfront cash payment of $50 million from Merck. Ariad will also be reimbursed for expenses it has incurred on ridaforolimus since January 1, which is estimated to be around $19 million.
Ariad will also be eligible to receive up to $514 million in regulatory and sales milestones based on the successful development and commercialization of ridaforolimus in multiple indications.
This includes $65 million in milestones associated with the potential sarcoma indication, which is currently in late-stage trial, the companies said in a statement.
Merck will fund 100 percent of future development, manufacturing and commercialization of the program, effective immediately, the companies said.
Shares of Ariad were trading up about 9 percent at $4.15 Wednesday in pre-market trade. They had closed at $3.81 Tuesday on Nasdaq.
Merck shares closed at $35.81 in the New York Stock Exchange. (Reporting by Krishnakali Sengupta in Bangalore; Editing by Roshni Menon)
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