Mereo BioPharma Inks Option and License Deal for Alvelestat, Up to $40M in Milestones
MREO sits 43% above its 52-week low of $0.2.
Summary
Mereo BioPharma has entered an option and license agreement with Sentynl Therapeutics for alvelestat, a potential first-in-class oral treatment for AATD-LD. Sentynl gains U.S. commercial rights and global manufacturing rights, while Mereo retains rest-of-world rights and leads global Phase 3 development. Mereo receives an upfront option fee and, upon option exercise, up to $40 million in upfront and R&D payments until NDA filing, plus up to $435 million in regulatory and commercial milestone payments, plus double-digit tiered royalties on U.S. sales. This deal provides non-dilutive funding for the Phase 3 program, which could start in early 2027, and validates alvelestat's commercial potential. The partnership follows Mereo's recent shareholder approval to issue up to 1.2 billion shares, offering a capital-efficient path forward. The companies will collaborate during the option period to refine the Phase 3 study design, with a clear regulatory path ahead.
Updated with an SEC 8-K filing · What changed
Updates
· SEC 8-K — The agreement includes up to $435 million in regulatory and commercial milestone payments in addition to the $40 million in upfront and R&D payments.
At the time of this announcement, MREO was trading at $0.29 on NASDAQ in the Life Sciences sector, with a market capitalization of approximately $43.5M. The 52-week trading range was $0.20 to $2.37. This news item was assessed with positive market sentiment and an importance score of 8 out of 10. Source: PR Newswire.