Merck KGaA Partners with Jiangsu Hengrui Pharmaceuticals in $1.48 Billion Cancer Drug License Deal

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Germany’s Merck KGaA has announced a partnership with China’s Jiangsu Hengrui Pharmaceuticals to license a promising cancer drug for up to 1.4 billion euros ($1.48 billion).

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Exclusive License and Option to Co-Promote

Merck has obtained an exclusive license outside of China to develop, manufacture, and commercialize the drug candidate HRS-1167 developed by Hengrui. In addition to this license, Merck also has the option to license Hengrui’s antibody-drug conjugate SHR-A1904. Furthermore, Merck has the opportunity to co-promote both assets in the Chinese market.

Financial Terms of the Collaboration

Under the agreement, Hengrui will receive an upfront payment of EUR160 million. In addition to this initial payment, Hengrui will be eligible for payments based on the achievement of specific development, regulatory, and commercial milestones. Hengrui will also receive tiered royalties on net sales by Merck. The total potential payments from Merck to Hengrui are capped at EUR1.4 billion.

Strengthening Merck’s Oncology Pipeline

Merck believes that this collaboration will enhance its oncology pipeline significantly. HRS-1167 has demonstrated encouraging signs of clinical activity and has shown benefits for patients in early-stage trials as a monotherapy. Furthermore, Merck recognizes its potential to be combined effectively with chemotherapy and other novel agents.

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