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March 20, 2019 6:30 am ET

Collaboration will Continue to Focus on Discovery and Development of Novel Biologic Therapeutics Across a Range of Therapeutic Areas

Merck to Return GDF15 Receptor Agonist Program to NGM

KENILWORTH, N.J., and SOUTH SAN FRANCISCO, Calif.–(BUSINESS WIRE)–Merck (NYSE:MRK), known as MSD outside the United States and Canada, and
NGM Biopharmaceuticals, Inc. (NGM) today announced that Merck has
exercised its option to extend the research phase of the companies’
broad, strategic collaboration for an additional two-year period from
March 2020 to March 2022. The collaboration, originally announced
in February 2015, is focused on discovering, developing and
commercializing novel biologic therapeutics across a wide range of
therapeutic areas. Under the terms of the original agreement, Merck had
the option to extend the initial five-year research and early
development phase of the collaboration for an additional two-year period
and retains one additional two-year extension option that is exercisable
in 2021.

“We are pleased that Merck has extended its collaboration with NGM,
ensuring that the important work we are doing together to discover and
develop novel medicines across a range of therapeutic areas and high
unmet needs will continue,” said Dr. David Woodhouse, chief executive
officer of NGM. “The deep resources and scientific autonomy provided by
this collaboration have enabled NGM to amplify the output of our
powerful discovery engine and maximize our ambitious research and
development goals. Together, we have progressed several potential
first-in-class drug candidates into clinical development, including
NGM313, now known as MK-3655, and we look forward to sustaining this
productivity on behalf of patients.”

“Merck and NGM scientists have established a strong collaboration based
on our mutual commitment to scientific excellence and the pursuit of
novel meaningful therapeutics for the treatment of disease,” said Dr.
Joe Miletich, senior vice president, preclinical and early development,
Merck Research Laboratories. “We look forward to continuing this
productive collaboration.”

During the two-year extension period, Merck will continue to fund NGM’s
research and development efforts at similar levels to the original
collaboration terms and, in lieu of the $20 million extension fee
payable to NGM, Merck will make additional payments totaling up to $20
million in support of NGM’s research and development activities during
the two-year extension period in 2021 and 2022.

As part of the collaboration, the companies previously announced
in January 2019 that Merck exercised its option to license NGM313, an
investigational monoclonal antibody agonist of the β-Klotho/FGFR1c
receptor complex for the treatment of nonalcoholic steatohepatitis
(NASH) discovered by NGM. Merck’s one-time option to license NGM313 (now
renamed MK-3655) was triggered by NGM’s completion of a proof-of-concept
clinical study of NGM313. Merck intends to advance MK-3655 into a Phase
2b study to evaluate the effect of MK-3655 on liver histology and
glucose control in NASH patients with or without diabetes.

NGM’s fibroblast growth factor 19 (FGF19) program, including its lead
clinical asset NGM282, currently in Phase 2 studies for the treatment of
NASH, is excluded from the agreement and remains wholly owned by NGM.

Merck and NGM also announced today that Merck will terminate its license
to NGM’s growth differentiation factor 15 (GDF15) receptor agonist
program, which is being developed for the treatment of obesity,
effective May 31, 2019. As part of the original collaboration agreement,
Merck received an exclusive worldwide license to NGM’s GDF15 analogs,
including NGM386 and NGM395, protein variants of GDF15 with potential
for once-daily and once-weekly or less frequent dosing, respectively. In
2018, Merck completed dosing of a Phase 1 multiple ascending dose
clinical trial evaluating NGM386 in otherwise healthy overweight/obese
subjects. Preliminary data from this study indicate that while NGM386
was generally well tolerated, treatment with the drug for 28 days did
not result in body weight loss relative to placebo.

Upon license termination, Merck will grant to NGM an exclusive license
under Merck’s intellectual property related to the GDF15 receptor
agonist program for further development and commercialization of
products, subject to the payment of a low single digit royalty on any
future product sales back to Merck. Merck’s decision to terminate the
GDF15 program, a right stipulated in the agreement, does not impact the
remainder of the collaboration arrangement.

“We continue to believe that the biology of GDF15 and its cognate
receptor, GFRAL, can play an important role in human disease with
potential effects on lipolysis and energy expenditure in metabolic
disease states. Upon transition of the programs back to NGM, we will
conduct an analysis of the clinical data and make a decision about
whether to pursue further development of NGM386 and/or NGM395,” said Dr.
Woodhouse.

About Merck

For more than a century, Merck, a leading global biopharmaceutical
company known as MSD outside of the United States and Canada, has been
inventing for life, bringing forward medicines and vaccines for many of
the world’s most challenging diseases. Through our prescription
medicines, vaccines, biologic therapies and animal health products, we
work with customers and operate in more than 140 countries to deliver
innovative health solutions. We also demonstrate our commitment to
increasing access to health care through far-reaching policies, programs
and partnerships. Today, Merck continues to be at the forefront of
research to advance the prevention and treatment of diseases that
threaten people and communities around the world – including cancer,
cardio-metabolic diseases, emerging animal diseases, Alzheimer’s disease
and infectious diseases including HIV and Ebola. For more information,
visit www.merck.com and connect
with us on Twitter,
Facebook,
Instagram,
YouTube
and LinkedIn.

About NGM Biopharmaceuticals, Inc.

NGM is a clinical stage biopharmaceutical company focused on developing
novel therapeutics based on scientific understanding of key biological
pathways underlying cardio-metabolic, liver, oncologic and ophthalmic
diseases. The company leverages its biology-centric drug discovery
approach to uncover novel mechanisms of action and generate proprietary
insights that enable it to move rapidly into proof-of-concept studies
and deliver potential first-in-class medicines to patients. NGM aspires
to operate one of the most productive research and development engines
in the biopharmaceutical industry, with multiple programs in clinical
development. Visit www.ngmbio.com for
more information.

Forward-Looking Statement of Merck & Co., Inc., Kenilworth, N.J., USA

This news release of Merck & Co., Inc., Kenilworth, N.J., USA (the
“company”) includes “forward-looking statements” within the meaning of
the safe harbor provisions of the U.S. Private Securities Litigation
Reform Act of 1995. These statements are based upon the current beliefs
and expectations of the company’s management and are subject to
significant risks and uncertainties. There can be no guarantees with
respect to pipeline products that the products will receive the
necessary regulatory approvals or that they will prove to be
commercially successful. If underlying assumptions prove inaccurate or
risks or uncertainties materialize, actual results may differ materially
from those set forth in the forward-looking statements.

Risks and uncertainties include but are not limited to, general industry
conditions and competition; general economic factors, including interest
rate and currency exchange rate fluctuations; the impact of
pharmaceutical industry regulation and health care legislation in the
United States and internationally; global trends toward health care cost
containment; technological advances, new products and patents attained
by competitors; challenges inherent in new product development,
including obtaining regulatory approval; the company’s ability to
accurately predict future market conditions; manufacturing difficulties
or delays; financial instability of international economies and
sovereign risk; dependence on the effectiveness of the company’s patents
and other protections for innovative products; and the exposure to
litigation, including patent litigation, and/or regulatory actions.

The company undertakes no obligation to publicly update any
forward-looking statement, whether as a result of new information,
future events or otherwise. Additional factors that could cause results
to differ materially from those described in the forward-looking
statements can be found in the company’s 2018 Annual Report on Form 10-K
and the company’s other filings with the Securities and Exchange
Commission (SEC) available at the SEC’s Internet site (www.sec.gov
).

Merck Media
Pam Eisele
(267) 305-3558
Claire Gillespie
(267) 305-0932

NGM Media:
Liz Melone
(617) 256-6622
media@ngmbio.com
or
Merck Investor:
Teri Loxam
(908) 740-1986
Michael DeCarbo
(908) 740-1807

NGM Investor:
ir@ngmbio.com