Merck KGaA has granted worldwide development and marketing rights to Lilly for its 5-HT2a antagonist compound EMD 281014, a potential breakthrough treatment for insomnia. EMD 281014 is currently in phase I clinical trials, Merck KGaA and Eli Lilly and Company has announced here.

Under the terms of the agreement, Merck will receive an upfront payment of EUR 22.5 million in the fourth quarter of 2004 as well as further potential milestone payments and royalties on product sales in future periods. Merck also has retained rights for potential co-promotion of the product in certain countries. The transaction is expected to close next month upon approval by the US Federal Trade Commission under the Hart-Scott-Rodino Act, Merck said in a release.

"Merck is pleased to entrust this unique molecule discovered and developed in-house to Lilly, which is a world leader in central nervous system pharmaceuticals," said Dr. Inge Lues, executive vice president of Preclinical Research and Development at Merck KGaA. "We believe Lilly can develop the considerable potential of EMD 281014 while we at Merck continue to focus our R&D efforts on our main therapeutic areas of Oncology and CardioMetabolic Care," he added later.

"EMD 281014 represents a novel approach to treating insomnia and potentially other central nervous system (CNS) disorders," Dr. Steve Paul, executive vice president, science and technology, Lilly said adding, "This highly selective and potent 5-HT2a antagonist complements our portfolio and reflects our continued commitment to address important unmet medical needs of patients afflicted with CNS-related disorders."

Insomnia affects more than 164 million people worldwide, including more than 49 million with chronic insomnia. Despite current therapies, there remain significant unmet medical needs.