Shares of Jiangsu Hengrui Pharmaceuticals Company, a Chinese pharmaceutical firm, jumped 10% to hit a 4-year high of 61-yuan, equivalent to USD 9.62 on the Shanghai Stock Exchange (SSE), after the company announced that it had agreed to license the global rights of its HRS-9821 drug and 11 other programs to GlaxoSmithKline Intellectual Property (GSK).
The programs were selected to complement GSK’s extensive Respiratory, Immunology & Inflammation (RI&I), and Oncology pipeline, having been assessed for their potential best-in-class or first-in-class profiles.
The agreements include an exclusive worldwide license (excluding mainland China, Hong Kong, Macau, and Taiwan) for a potential best-in-class PDE3/4 inhibitor (HRS-9821), which is in clinical development for the treatment of chronic obstructive pulmonary disease (COPD) as an add-on maintenance treatment, regardless of background therapy, GSK said in its filing on Monday.
The British pharmaceutical giant added that HRS-9821 supports its ambition to treat patients across the widest spectrum of COPD, including those who experience continued dyspnea (shortness of breath) or are unlikely to receive inhaled corticosteroids or biologics, based on their disease profile.
The agreements also feature a pioneering, large-scale collaboration to develop up to 11 additional programs besides HRS-9821, each with its own financial structure. Hengrui Pharma will lead the development of these programs up to the completion of Phase I trials, including trials involving patients outside of China.
GSK will have the exclusive option to further develop and commercialize each program worldwide (excluding mainland China, Hong Kong, Macau, and Taiwan) at the end of Phase I or earlier, at its discretion, and will also have program substitution rights.
GSK has agreed to pay $500 million in upfront fees across the agreements, including for the license of the PDE3/4 program. The potential total value of future success-based development, regulatory, and commercial milestone payments to Hengrui Pharma could reach approximately $12 billion if all programs are optioned and all milestones are met.
Additionally, Hengrui Pharma will be eligible for tiered royalties on global product net sales (excluding mainland China, Hong Kong, Macau, and Taiwan). The license to HRS-9821 remains subject to customary conditions, including regulatory clearance under the Hart-Scott-Rodino Act in the United States.
Tony Wood, Chief Scientific Officer at GSK, said, “We’re delighted to announce these exciting agreements with Hengrui Pharma, which complement our already extensive pipeline. This deal reflects our strategic investment in programs that address validated targets, increasing the likelihood of success, while giving us the option to advance the assets with the greatest potential for patient impact.”
About Hengrui Pharma
Founded in 1970, Hengrui Pharma is a global pharmaceutical company dedicated to research, development, and commercialization of high-quality medicines to address unmet clinical needs.
With a global R&D network of 14 centers and over 5,500 professionals, Hengrui’s therapeutic focus includes oncology, metabolic and cardiovascular diseases, immunological and respiratory disorders, and neuroscience.
To date, Hengrui has commercialized 23 new molecular entity drugs and 4 other innovative drugs in China.
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