Japan’s Astellas Pharma and Aveo Pharmaceuticals, a Cambridge, Mass.-based biopharmaceutical firm, have formed a partnership to develop Aveo’s lead drug candidate, tivozanib, outside Japan. Tivozanib is a small-molecule VEGF inhibitor designed to block all three of the VEGF pathways. The drug is currently in Phase III clinical trials comparing it with sorafenib, marketed as Nexavar by Bayer, in patients with advanced renal cell carcinoma. Aveo will receive a cash payment of $125 million, composed of a $75 million licensing fee and $50 million in R&D funding. The company also is eligible for $1.3 billion in milestone payments.