Novartis to Pay Up to USD2.9 Billion for Exclusive Rights to BeiGene’s New Anti-Cancer Drug

[Stranagor]

Novartis to Pay Up to USD2.9 Billion for Exclusive Rights to BeiGene’s New Anti-Cancer Drug

www.yicaiglobal.com

(Yicai Global) Dec. 22 -- Chinese drugmaker BeiGene has agreed to grant Swiss pharmaceutical giant Novartis the exclusive development, manufacturing and commercialization rights to an experimental oncology drug in major markets outside China in a deal that could be worth as much as USD2.9 billion.

Novartis will make an upfront payment of USD300 million to develop and license the monoclonal antibody ociperlimab in the US, EU, Japan, Canada, Mexico and several European nations, BeiGene said. It will also pay a further USD700 million should the Basel-based firm decide to extend the partnership.

Ociperlimab, which is still at the research stage, has been shown to inhibit tumor development. Once the drug gets the green light to go to market, Novartis will make a milestone payment of USD2 billion to Beijing-based BeiGene, as well as sales commissions of between 20 and 25 percent.

This is the second landmark deal between the two parties. In January, Novartis paid USD2.2 billion for the exclusive rights to BeiGene’s monoclonal antibody tislelizumab. The downpayment of USD650 million was the largest ever received by a Chinese drugmaker and the overall value of the licensing deal was the biggest for a single drug.

BeiGene is the only company in the world to be listed in Shanghai, Hong Kong and the US. Its US stock [NASDAQ:BGNE] was trading down 0.34 percent at USD272.87 as of 12:30 EST yesterday. Its Shanghai-listed shares [SHA:688235] gained 0.89 percent to finish the day at CNY157.10 (USD25) yesterday and its Hong Kong stock [HKG:6160] surged 6.11 percent to close at HKD166.70 (USD21.40).

Editor: Kim Taylor

 

[Song Hong]

A lot of western boutique labs set up shop in China, and start using Chinese companies as cover to get approval, and test in China market. Reason because FDA will never allow any new comers to challenge the existing drug which is cash cow for big pharma, unless the new drug can surpass the old drug in all areas.

Many of these new drugs is very good, but probably have one or two domain that is a little behind the existing drug, either in side effect or efficacies.

These drug can get approved in China easier and sell with a price much lower than the existing drug.

Then Western big pharma start to sign these new drugs on board, as they now realized they cannot prevent these new drug from market access anymore.

 

[FairAndUnbiased]

A lot of western boutique labs set up shop in China, and start using Chinese companies as cover to get approval, and test in China market. Reason because FDA will never allow any new comers to challenge the existing drug which is cash cow for big pharma, unless the new drug can surpass the old drug in all areas.

Many of these new drugs is very good, but probably have one or two domain that is a little behind the existing drug, either in side effect or efficacies.

These drug can get approved in China easier and sell with a price much lower than the existing drug.

Then Western big pharma start to sign these new drugs on board, as they now realized they cannot prevent these new drug from market access anymore.

the Beigene antibody is neither cheap nor worse in efficacy. Monoclonal antibodies are incredibly expensive, and have some of the highest efficacies in treatment available. It is just a straight up better drug in every way. However, Beigene doesn't have the distribution networks or regulatory expertise that Novartis does.

 

[Song Hong]

This is not my domain. I am just making a general comment. Has nothing to do with this deal.