Amrad boosted by US$3 million milestone payment

Amrad (ASX: AML) has received its first milestone payment from its exclusive licensing and research collaboration agreement with Merck, Sharp and Dohme (MSD).

The US$3 million payment brings to US$8 million the payments received by the company since signing the agreement, worth up to US$112 million over its lifetime, in June.

"This is important not just because of the payment itself, but also because it demonstrates the capabilities of our Biologicals Research group here at Amrad in achieving excellent progress against the research objectives agreed with MSD," said Amrad CEO Dr Peter Smith.

"It clearly illuminates that things on the inside are progressing very, very well."

Smith said there was at least one more milestone payment based on contributions to the project by Amrad.

The two companies are working together to investigate drug candidates targeting the IL-13 receptor, for possible use in asthma, other kinds of respiratory disease and oncology. MSD will be responsible for all clinical work and marketing of any products arising from the collaboration.

He said the payment was proof that the company's new business strategy was on target and that the science was delivering value.

"The important thing is that it does reflect progress despite the upheavals of the last year," Smith said.

MSD managing director Will Delaat said the milestone reinforced their confidence in the quality of Amrad's research.

Amrad's share price was up almost ten per cent at the time of writing, with shares trading at AUD$0.68.