Dr. Reddy’s Laboratories and Merck Serono, a division of Merck KGaA, have partnered to codevelop a portfolio of biosimilar compounds in oncology. The partnership will focus on monoclonal antibodies and covers codevelopment, manufacturing, and commercialization of the compounds worldwide.

For Dr. Reddy’s, the partnership will help expand the company’s presence in the biosimilar area and enable them to participate globally. For Merck, the announcement represents the company’s early steps to make inroads into the biosimilars marketplace. Earlier this year, Merck also announced that it was setting up a dedicated biosimilars unit in the Canton of Vaud in Switzerland. The company’ move into biosimilars is part of the Merck Group’s transformation program, which aims to deliver long-term value and growth opportunities for the company.

In a statement, G.V. Prasad, vice-chairman and CEO of Dr. Reddy’s, explained, “Biosimilars is an important area of future growth... With the recent EMA and FDA guidance on biosimilars, it is clear that any significant player in the field will need strong biologics development, manufacturing, and commercialization capabilities.”

According to the agreement, Dr. Reddy’s and Merck will codevelop the molecules and share R&D costs. Dr. Reddy’s will lead early product development and complete Phase I development, after which Merck will take over in manufacturing and Phase II development.

Merck Serono will commercialize the molecules globally, except for in the US and in certain select emerging markets, which will be coexclusive or are where Dr. Reddy’s already maintains exclusive rights. In the US, products will be cocommercialized on a profit-sharing basis.

Additional details of the deal have not been disclosed.

In the statement, Stefan Oschmann, Merck executive board member and CEO of Merck Serono, added, “Sharing know-how, risks, and rewards is the right approach to enter the emergent biosimilars market and will be a win–win for both parties.”