On December 12, 2023, C4 Therapeutics, Inc. (C4T), a clinical-stage biopharmaceutical company dedicated to advancing targeted protein degradation science to develop a new generation of small-molecule medicines and transform how disease is treated, announced that it has entered into an exclusive license and collaboration agreement with Merck (known as MSD outside of the U.S. and Canada) to develop degrader-antibody conjugates (DACs), an emerging modality designed to selectively target and neutralize disease-causing proteins in cancer cells. Wilson Sonsini Goodrich & Rosati advised C4 Therapeutics on the transaction.

Under the terms of the agreement, C4T will receive a $10 million upfront payment. C4T and Merck will collaborate to develop DACs directed to an initial undisclosed oncology target that is exclusive to the collaboration. For DACs directed to this initial target, C4T is eligible to receive milestone payments totaling approximately $600 million, as well as tiered royalties on future sales. The agreement also provides Merck with the option to extend the collaboration to include three additional targets that would be exclusive to the collaboration, which could yield option exercise payments as well as potential milestones and royalties. If Merck exercises all of its options to extend the collaboration, C4T would be eligible to receive up to approximately $2.5 billion in potential payments across the entire collaboration.

The Wilson Sonsini team that advised C4T on the transaction includes Farah Gerdes and Sarah Walker.

For more information, please see C4T’s press release.