Wedbush provided its review on Mersana Therapeutics, Inc. (NASDAQ:MRSN) after the company entered into a research collaboration and commercial license agreement with a subsidiary of Merck KGaA to develop up to two novel STING-agonist ADCs using the company’s immunostimulatory platform.

The company will receive $30 million upfront in addition to up to $800 million in potential milestones and tiered royalties, up to low double-digits, on net sales. As part of the research collaboration, the company will develop the ADC product candidates by combining its immunosynthen platform with proprietary antibodies from Merck KGaA.

The company will handle certain discovery activities and limited preclinical manufacturing/supply, which will be reimbursed by Merck KGaA.