Merck, Pfizer to Team Up on New Diabetes Drug

They will share any revenue from the new treatment


prescription drugs 300x180 Merck, Pfizer to Team Up on New Diabetes DrugOn Monday, Merck & Co. (NYSE:MRK) said it would partner with Pfizer (NYSE:PFE) to develop a new diabetes treatment.

Merck paid Pfizer an initial $60 million to launch the partnership. The company said it would receive 60% of any revenue from the new drug, while Pfizer would collect 40%. The companies also planned to divide certain drug development costs on a similar basis, the Associated Press noted.

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Centered around ertugliflozin, a drug developed by Pfizer, the partnership will examine potential combination treatments with Merck’s diabetes drug, Januvia, as well as other Merck drugs.

Ertugliflozin will begin late-stage clinical trials later this year.

In February, Merck shares tumbled after the company said it would delay efforts to obtain approval from a new osteoporosis drug from the U.S. Food and Drug Administration until 2014.

Shares of Merck sank almost 1% in Tuesday morning trading, while Pfizer fell more than 2%.

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