Biotech company I-Mab has announced that it will sell its Chinese unit to I-Mab Biopharma (Hangzhou) for up to $80 million. This move comes as I-Mab shifts its focus to the U.S. market. The full consideration of $80 million will be dependent on certain regulatory and sales milestones. However, I-Mab will still retain the right to negotiate on the marketing of three drug candidates developed outside of China.
I-Mab, which was originally founded in China, currently operates in Rockville, Md. and San Diego. The decision to divest its operations in China emphasizes I-Mab’s commitment to bringing greater attention to the U.S. and other markets outside of China. CEO Raj Kannan stated that this agreement is an important milestone for the company and will allow them to reduce costs while allocating capital to other priorities.
As part of the deal, I-Mab Biopharma Hong Kong will transfer its equity interests in the Hangzhou company to its shareholders. In exchange, I-Mab Hong Kong will extinguish buyback obligations totaling approximately $183 million. The remaining buyback obligations will range between $30 million and $35 million.
In addition to this transaction, I-Mab has made a $19 million investment in the Hangzhou company during a Series C fundraising round. Following the closing of the deal, I-Mab and I-Mab Hong Kong will together own less than 10% of the registered capital of the Hangzhou company.
To support these changes, I-Mab has made several leadership appointments. Pamela Klein has been named interim chairperson, replacing the current chairman and founder Jingwu Zang, who will now lead the Hangzhou company. Joseph Skelton has been appointed as the new CFO, replacing Richard Yeh. Furthermore, President Andrew Zhu will step down as an executive and board director.
This strategic move by I-Mab highlights its dedication to expanding its presence in the U.S. market, while also streamlining operations and unlocking opportunities for growth.