China's Hansoh Pharma strikes drug deal with Roche worth over $15 billion

Hansoh Pharma and Roche Sign $15 Billion Oncology Partnership Deal

By Nichiket Sunil and Patrick Wingrove

Major Oncology Licensing Agreement Between Hansoh and Roche

Deal Overview and Financial Terms

Oct 19 (Reuters) - China's Hansoh Pharmaceutical said on Monday it has entered into a partnership and licensing deal with Roche potentially worth more than $15 billion that covers a portfolio of antibody-drug conjugate programs.

As part of the deal with the Swiss drugmaker's unit F. Hoffmann-La Roche, Hansoh will receive an upfront payment of $400 million, a first anniversary payment of $110 million and further milestone payments. 

Antibody-Drug Conjugate Technology

Antibody-drug conjugates are targeted cancer therapies that act like guided missiles, attaching toxic chemotherapy directly to tumor cells while sparing healthy tissue.

Roche currently sells two approved ADCs, Kadcyla and Polivy, that analysts expect to generate a combined 3.5 billion Swiss francs ($4.3 billion) this year, according to LSEG data.

Development and Commercialization Rights

Under the terms of the Hansoh partnership, the Chinese company will lead early development until global Phase Ia clinical trials are complete. 

Roche will then take over worldwide development and commercialization, the Chinese company said, excluding mainland China, Hong Kong, Macau, and Taiwan, where Hansoh retains rights. 

Hansoh also has the option to take part in developing up to two programs outside those markets. 

Strategic Importance for Roche

Roche said the collaboration, combined with its own research, gave the company the opportunity to advance antibody-drug conjugates as a central component of its next-generation oncology strategy.

The two companies have previously partnered on colorectal cancer treatments.

Roche’s Broader Dealmaking Strategy

Recent Partnerships and Licensing Deals

ROCHE STEPPING UP DEALMAKING

Facing impending patent cliffs on aging blockbusters, Roche is increasingly turning to external dealmaking to rebuild its pipeline and capture next-generation therapies. 

Other Notable Deals in 2023

In August, the Swiss drugmaker's Genentech struck a deal with DualityBio worth up to $1 billion for its ADC therapies.

Earlier this month, Roche secured an obesity drug licensing agreement worth up to $1.16 billion with China's Rona Therapeutics, following a January commitment of $100 million upfront for a non-exclusive patent license from Structure Therapeutics covering oral weight-loss drugs.

Market Impact and Industry Trends

Teaming up with Hansoh could also fast-track Roche’s route to market. While Roche is advancing oral SERDs like giredestrant in breast cancer, its broader late-stage pipeline faces a notable valley until the end of the decade, making external partnerships essential for near-term momentum.

Drugmakers have struck over a dozen licensing deals with Chinese companies in the past year, highlighted by AstraZeneca’s $18.5 billion obesity drug pact with CSPC in January and Bristol Myers Squibb’s $15.2 billion multi-program alliance with China’s top drugmaker, Jiangsu Hengrui, in May. 

(Reporting by Nichiket Sunil in Bengaluru and Patrick Wingrove in London; Editing by Sonia Cheema and Jan Harvey)