Baxter International Inc. said Wednesday it will work with Onconova Therapeutics to help develop and market an experimental cancer drug in Europe.

Onconova has been studying the drug candidate, rigosertib, as a treatment for a group of blood cancers called myelodysplastic syndromes and for pancreatic cancer. Baxter agreed to pay Onconova $50 million upfront, and Onconova will get another $515 million if the drug advances through clinical testing and regulatory review. The agreement also calls for Onconova to get royalties on sales, and milestone payments if the drug reaches sales targets.

Baxter can market the drug in the European Union and other European countries as a treatment for both of those cancer types. The Deerfield, Ill., company will also have an option to help develop and market rigosertib as a treatment for other cancers.

The companies said data from a late-stage trial of rigosertib as a treatment for myelodysplastic syndromes, or MDS, is due in the second half of 2013. Onconova is also studying an oral version of the drug.

Rigosertib has been granted orphan drug status in the U.S. and Europe as a treatment for MDS. The orphan drug program provides financial incentives for drugs designed to treat rare diseases, and approved orphan drugs can receive extended marketing exclusivity.

Baxter previously invested $50 million in Newtown, Pa.-based Onconova. The company said Wednesday the latest announcement is part of its expansion into oncology treatments. It already supplies chemotherapeutic agents as well as treatments for the side effects of cancer therapies like nausea.

Shares of Baxter rose 21 cents to $61.16 in midday trading.