Lycera has expanded its collaboration with Merck & Co. to develop small-molecule drugs against autoimmune diseases. In 2011, the companies began work on immune modulators targeting the retinoic acid-related orphan receptor. Under the new agreement, Merck will pay an up-front fee, provide research funding, and make up to $300 million in milestone payments. In addition, Merck will handle clinical development and commercialization of any resulting products. Lycera is a 2006 spin-off of the University of Michigan.