After Merck, Chinese Biotech Hengrui Pharma Collaborates With GSK In Worth $12 Billion Pact

Chinese biotech company Hengrui Pharma partnered with GSK plc GSK on Monday to develop up to 12 medicines.

These agreements will add significant value to Hengrui’s globalization strategy and provide GSK with significant new growth opportunities beyond 2031.

The programs were selected to complement GSK’s extensive Respiratory, Immunology & Inflammation (RI&I) and Oncology pipeline.

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GSK will pay $500 million in upfront fees across the agreements.

The agreements include an exclusive worldwide license (excluding mainland China, Hong Kong SAR, Macau SAR, and Taiwan region) for (HRS-9821) in clinical development for chronic obstructive pulmonary disease (COPD) as an add-on maintenance treatment, irrespective of background therapy.

HRS-9821 has demonstrated potent PDE3 and PDE4 inhibition, leading to increased bronchodilation and anti-inflammatory effects in early clinical and preclinical studies.

In addition, HRS-9821 provides the opportunity for a convenient dry-powder inhaler (DPI) formulation that strategically fits GSK’s established inhaled portfolio.

The agreements also include a scaled collaboration to generate up to 11 programs in addition to HRS-9821, each with its financial structure.

Hengrui Pharma will lead the development of these programs up to completion of phase I trials. Patients outside of China will participate.

GSK may commercialize each program, except for those in China, Hong Kong, Macau, and Taiwan, at the end of phase 1.

Tony Wood, Chief Scientific Officer, GSK, said: “This deal reflects our strategic investment in programs that address validated targets, increasing the likelihood of success, and with the option to advance those assets with the greatest potential for patient impact.”

The collaboration enables scale and speed to proof-of-concept to develop up to 11 additional innovative medicines.”

If all programs are optioned and all milestones are achieved, the potential total value of future success-based development, regulatory, and commercial milestone payments to Hengrui Pharma is approximately $12 billion.

In addition, Hengrui Pharma will be eligible to receive tiered royalties on global product net sales (excluding mainland China, Hong Kong SAR, Macau SAR, and Taiwan region).

In March, Merck & Co. Inc. MRK and Hengrui Pharma entered into an exclusive license agreement for HRS-5346, an investigational oral small molecule Lipoprotein(a), or Lp(a), inhibitor currently being evaluated in a Phase 2 trial in China.

Under the agreement, Hengrui Pharma has granted Merck exclusive rights to develop, manufacture, and commercialize HRS-5346 worldwide, excluding the Greater China region.

Hengrui Pharma will receive an upfront payment of $200 million and is eligible to receive milestone payments associated with certain development, regulatory, and commercial milestones up to $1.77 billion and royalties on net sales of HRS-5346 if approved.

Price Action: GSK stock is down 0.74% at $37.69 at the last check on Monday.

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