A day after announcing an agreement with a Chinese firm to develop and commercialize a new drug cocktail treatment for chronic hepatitis C, TaiGen Biopharmaceuticals Holdings Ltd (太景醫藥研發控股) provided more details of the link-up.
TaiGen and YiChang HEC ChangJiang Pharmaceutical Co Ltd (HEC, 宜昌東陽光長江藥業) have agreed to establish a joint venture to produce a treatment cocktail of two oral direct-acting antiviral agents (DAA) — TaiGen’s furaprevir (TG-2349), a NS3/4A protease inhibitor, and HEC’s yimitasvir (DAG-181), a NS 5 protein inhibitor.
The joint venture is to be established before the end of this year with capitalization of 680 million yuan (US$102 million), of which 348.4 million yuan would be provided by HEC in cash in exchange for a 51 percent stake.
TaiGen will receive a 49 percent stake for its licensing rights to TG-2349, which is appraised at about US$50 million, company officials said yesterday at a news conference in Taipei.
The company is expecting to book profits of US$20 million for its 49 percent stake before the second half of next year, TaiGen vice president of finance Richard Lu (呂理堅) said.
The agreement also stipulates that when the new cocktail completes its second-phase clinical trials in China, TaiGen would sell a 9 percent-portion of its stake in the joint venture to HEC for about another US$40 million, Lu added.
However, the conditions for the US$40 million sale would be contingent upon whether the new cocktail is able to achieve a sustained viral response rate of more than 90 percent in its second-phase study, Lu said.
The new cocktail has received fast-track review designation from Chinese regulators, and is scheduled to hit the market in two to three years, TaiGen chief operating officer Hsu Ming-chu (許明珠) said.
The outcome of scientific due diligence and animal testing on drug-to-drug interactions combining TG-2349 and DAG-181 have been favorable, Hsu said.
“We were approached by HEC last May to explore a partnership and we found the company to be a capable partner in terms of funding as well as the viability of its new drug,” Hsu said, adding that TaiGen had rejected a number of prospective candidates.
The joint venture will allow TaiGen to begin commercializing new drugs earlier in the development phase. In the past its revenue streams came from out-licensing its late-stage development drugs.
Currently available DAA treatments for hepatitis C can cost as much as US$90,000 for a 12-week regimen, but the joint venture’s new drug would be priced significantly lower, Hsu said.
The lower pricing, and the enlisting of a Chinese partner represent an advantage in gaining approval from Beijing regulators, who are looking to control China’s healthcare costs and improve access to treatments, Hsu said.
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