Gilead receives option to license novel trispecific therapeutics in Merus deal

Under the terms of the agreement, Merus will lead early-stage research activities for two programs, with an option to pursue a third. Gilead will have the right to license programs developed under the collaboration after the completion of select research activities. If Gilead exercises its option to license any such program from the collaboration, Gilead will be responsible for additional research, development and commercialization activities for such program. Merus will receive an upfront cash payment of $56 million for initial targets as well as an equity investment by Gilead of $25 million in Merus common shares. Across all potential programs, Merus is also eligible to receive up to $1.5 billion including additional near term and option payments, potential development and commercialization milestones, as well as tiered royalties ranging from the mid-single to low-double digits on product sales should Gilead successfully commercialize a therapy from the collaboration. For the third potential program, Merus may opt-in to share 50/50 split of net profits and net losses, in lieu of future milestone and royalty payments. Gilead does not exclude acquired IPR&D expenses from its non-GAAP financial measures. This transaction with Merus is expected to reduce Gilead’s GAAP and non-GAAP 2024 EPS by approximately $0.03 – $0.05.