Health care company Bayer said on Friday that it has exercised its option to obtain the exclusive licensing rights for the global development and commercialisation of Vitrakvi and BAY 2731954 under the change-in-control clause collaboration agreement with Loxo Oncology.

Both the Vitrakvi (larotrectinib) and BAY 2731954 (LOXO-195) compounds are being developed globally for the treatment of adult and paediatric patients with advanced solid tumours harboring NTRK gene fusions, added Bayer.

TRK fusion cancer occurs when an NTRK gene fuses with another unrelated gene, producing an altered TRK protein. The altered protein, or TRK fusion protein, becomes constitutively active or overexpressed, triggering a signaling cascade. These TRK fusion proteins act as oncogenic drivers promoting cell growth and survival, leading to TRK fusion cancer, including lung, thyroid, GI cancers (colon, cholangiocarcinoma, pancreatic and appendiceal), sarcoma, CNS cancers (glioma and glioblastoma), salivary gland cancers (mammary analogue secretory carcinoma) and paediatric cancers (infantile fibrosarcoma and soft tissue sarcoma), disclosed the company.

Following this exercise, the joint co-promotion agreement in the US between Bayer and Loxo Oncology is being converted to full commercialisation in the US by Bayer and the sharing of commercial costs and profits on a 50/50 basis for the US market will be replaced by royalties to be paid by Bayer. Bayer will continue to pay royalties on future net sales outside the US .The option was triggered by the acquisition of Loxo Oncology by Eli Lilly and Company.

In conjunction with Bayer's exercise of the option, certain licenses granted by Loxo Oncology to Bayer will become exclusive following anti-trust clearance in the US.