In a strategic move to enhance its oncology portfolio, GSK plc has obtained an exclusive license to develop and commercialize HS-20089, a B7-H4 targeted antibody-drug conjugate (ADC) with topoisomerase inhibitor (TOPOi) payload technology. The drug, currently undergoing phase I trials in China, is designed to target gynaecologic cancers, specifically ovarian and endometrial cancer.
The agreement was facilitated by Senior VP Hesham Abdullah from GSK and Eliza Sun from Hansoh Pharma. As part of the deal, GSK will initiate phase I trials outside China in 2024 and make an upfront payment of $85 million to Hansoh. The agreement also includes the potential for success-based milestones up to $1.485 billion.
The license grants GSK global rights to develop and commercialize HS-20089, excluding mainland China, Hong Kong, Macau, and Taiwan. This acquisition is part of a growing trend of ADC deals in the pharmaceutical industry. Notable recent agreements include a $22 billion deal between Merck and Taiho Pharmaceutical and a partnership between Innovent Biologics and BioNTech (NASDAQ:BNTX) targeting HER3.
GSK, a prominent player in the pharmaceuticals industry according to InvestingPro Tips, has a market cap of $72.39 billion as per InvestingPro Data. The company has a history of maintaining dividend payments for 23 consecutive years, signifying a strong financial background and stable returns for shareholders. It's worth noting that GSK's return on assets is 21.33%, indicating efficient use of its assets to generate profits.
Both companies have expressed confidence in the potential of HS-20089. Johnson Pharmaceuticals aims to provide first-in-class or best-in-class drugs and views GSK as an ideal partner due to its focus on tumor cell targeting modalities and expertise in gynecologic cancers. This confidence is backed up by the fact that 3 analysts have revised their earnings upwards for the upcoming period, as per InvestingPro Tips.
Regulatory clearances are required before further development can proceed, including adherence to the Hart-Scott-Rodino Act in the US. After commercialization, GSK will pay tiered royalties on global net sales of the drug. GSK's cash flows can sufficiently cover interest payments, which is a positive sign for the company's financial health, according to InvestingPro Tips.
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