Hengrui Medication Partners with BMS for $15.2 Billion Early Drug Licensing

Hengrui Medicine and global pharmaceutical giant Bristol-Myers Squibb announced the conclusion of a groundbreaking global strategic cooperation agreement. The potential total transaction value of this agreement reaches up to approximately 15.2 billion USD, marking one of the largest outbound licensing deals to date for a domestic Chinese pharmaceutical company.

Following this positive news, the secondary market has reacted dramatically. The share price of Hengrui Medicine in the Hong Kong stock market surged直线跳升 after lunchtime, with the increase once exceeding 15%, reaching a peak of 76.75 HKD. At the same time, the price increase of Hengrui Medicine's A-shares also once approached 6%.

According to the announcement made by both parties on May 12, Bristol-Myers Squibb will pay up to 950 million USD to Hengrui as an immediate payment. This sum includes an initial payment of 600 million USD, along with two anniversary payments totaling 350 million USD to be paid over the next several years.

The potential total of 15.2 billion USD not only covers the development, registration, and commercialization milestone payments for 13 early-stage projects but also includes the exercise costs for the option of collaborating on R&D projects. The transaction is expected to be completed by the third quarter of 2026.

The core assets of this cooperation include 13 innovative drug projects that have yet to enter clinical research phases. This includes 4 oncology and hematology projects originally developed by Hengrui, as well as 4 immunology projects originally developed by Bristol-Myers Squibb.

The remaining 5 innovative projects will be jointly developed by both parties through Hengrui's R&D engine and diverse innovation technology platform. According to the agreement, Hengrui will be fully responsible for the early clinical development of these projects to expedite clinical proof of concept.

Regarding the division of rights and benefits, both parties have achieved a strategic swap of global market rights. Bristol-Myers Squibb obtains the global exclusive rights for Hengrui's original projects and joint development projects outside of the Greater China region. Hengrui, in turn, gains the exclusive rights to four original projects from Bristol-Myers Squibb within the Greater China region. Moreover, Hengrui has the right to charge Bristol-Myers Squibb a tiered sales royalty based on the net sales of the product in overseas markets.