Drugmakers Pfizer Inc and Merck & Co Inc said they would jointly develop Pfizer’s experimental type 2 diabetes drug, ertugliflozin, and expect late-stage trials to start later in 2013.

Pfizer has so far received $60 million in upfront and milestone payments and will be eligible for additional payments associated with clinical, regulatory and commercial milestones.

Merck and Pfizer will share potential revenue and certain costs on a 60/40 percent basis, the companies said.

Merck and Pfizer will collaborate on the development and marketing of ertugliflozin and ertugliflozin-containing fixed-dose combinations with metformin, a common diabetes treatment, and Merck’s Januvia tablets.

Merck will continue to retain the rights to its existing portfolio of Januvia-containing products.

(Reporting by Esha Dey in Bangalore; Editing by Saumyadeb Chakrabarty)

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Reuters