Emergent BioSolutions, a Rockville, Md.-based global specialty biopharmaceutical company, and MorphoSys, a Germany-based provider of therapeutic antibodies, have inked an agreement for the joint development and commercialization of Emergent’s preclinical bi-specific antibody, ES414, targeting prostate cancer. Emergent will receive an upfront payment of $20 million and milestone payments of up to $163 million.

Milestone payments are linked to specific events, including successful development of ES414 in several indications and securing approval in certain territories. Emergent and MorphoSys will jointly develop ES414, with MorphoSys bearing 64% and Emergent 36% of the total costs. Emergent will retain commercialization rights in the U.S. and Canada, with a tiered royalty obligation to MorphoSys, from mid-single digit up to 20%. MorphoSys will gain worldwide commercialization rights excluding the U.S. and Canada, with a low single digit royalty obligation to Emergent. Emergent will manufacture and supply clinical material from its manufacturing facilities in Baltimore, Md. Additional financial details have not been disclosed.

ES414, which will be renamed MOR209/ES414, was developed by Emergent using its proprietary ADAPTIR (modular protein technology) platform. Preclinical in vitro and in vivo studies have shown that ES414 redirects T-cell cytotoxicity toward prostate cancer cells expressing Prostate Specific Membrane Antigen (PSMA), an antigen commonly found on such cells.

Arndt Schottelius, chief development officer of MorphoSys, said, “We believe ES414 has the potential to be an important therapy for prostate cancer, where there is a pressing need for better treatments. The preclinical data suggest that the molecule has a number of potential advantages over other drug candidates in this indication. Our goal is to combine our capabilities with those of Emergent to enable the fastest possible development and commercialization of ES414.”

Emergent and MorphoSys plan to initiate a phase I clinical trial evaluating ES414 in patients with metastatic castration-resistant prostate cancer (mCRPC) within the next six months. The initial phase of the trial will be conducted in the U.S. and Australia, with Emergent as the sponsor.