Roche and Hansoh agree cancer drug deal potentially worth over $15 billion

what happened

China's Hansoh Pharmaceutical said on Monday that its units signed a collaboration and licensing agreement with Roche. Reuters reports that the potential value of the deal exceeds $15 billion and covers a portfolio of antibody-drug conjugate programs. Hansoh will get a $400 million upfront payment, a $110 million payment at the first anniversary, and further milestone payments.

Dow Jones Newswires, citing a Hansoh statement, adds that the portfolio includes two Hansoh programs and several others built on its technology platform using drug targets proposed by Roche. The programs cover multiple cancer types. Hansoh will lead early development, and Roche will take over outside China, Hong Kong, Macau and Taiwan after early-stage trials are complete. Hansoh could also receive royalties if the products reach the market.

why it matters

The deal expands the relationship between the two companies and extends Roche's string of dealmaking in China. For investors it signals that large Western drugmakers keep looking to Chinese biotech for early-stage drug programs, and the size of the potential payments points to high regard for Hansoh's platform.

market impact

Pharma and China biotech: a large licensing deal may support interest in Hansoh's pipeline and Roche shares

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