By Giulia Petroni

Merck KGaA said Thursday that the U.S. Food and Drug Administration has cleared the investigational new drug application for M5049 for the treatment of Covid-19 patients with pneumonia.

The German pharmaceutical and chemicals company said it would initiate a Phase 2 clinical study to investigate whether the use of M5049 could reduce the inflammatory response that can lead to the "cytokine storm"--an overreaction of the body's immune system--in coronavirus patients with pneumonia.

"Successful intervention with the investigational drug may reduce life-threatening complications of Covid-19, including severe respiratory symptoms," the company said.

Merck said it expects results from the Phase 2 study around the end of 2020.

Write to Giulia Petroni at giulia.petroni@wsj.com