Amgen, BeiGene in $2.7-Bn Oncology Pact for ChinaBy
Amgen has entered into a global strategic oncology collaboration with BeiGene, a Beijing-headquartered company, under which Amgen will acquire an equity stake in BeiGene for approximately $2.7 billion.
The companies will collaborate for the commercialization and development in China of Amgen’s Xgeva (denosumab), for treating giant cell tumors of the bone, Kyprolis (carfilzomib), for treating multiple myeloma, and Blincyto (blinatumomab), for treating relapsed or refractory acute lymphoblastic leukemia. The companies will also collaborate for the joint global development of 20 oncology assets in Amgen’s pipeline, with BeiGene responsible for development and commercialization in China. In connection with the collaboration, Amgen will purchase a 20.5% stake in BeiGene for approximately $2.7 billion. Amgen will continue to commercialize its non-oncology product portfolio in China.
Under the agreement, BeiGene will commercialize Xgeva (denosumab), Kyprolis (carfilzomib) and Blincyto (blinatumomab) in China during which time the parties will equally share profits and losses. These products will be manufactured at Amgen’s existing facilities. Two of these products will revert to Amgen, one after five years and one after seven years. Following the commercialization period, BeiGene will have the right to retain one product and will be entitled to receive royalties on sales in China for an additional five years on the product not retained. Xgeva was launched in China in September 2019; Kyprolis and Blincyto are both in Phase III trials in China.
Amgen and BeiGene will collaborate to advance 20 medicines from Amgen’s oncology pipeline in China and globally. BeiGene will share global research and development costs and contribute up to $1.25 billion to advance these medicines. Amgen will pay royalties to BeiGene on the sales of these products outside of China, with the exception of Amgen’s AMG 510, a KRAS (G12C) inhibitor being studied as a potential treatment for solid tumors.
Of the 20 oncology medicines in development, BeiGene will assume commercial rights in China for seven years after launch for those that receive approval in China, including AMG 510. After this time, BeiGene will retain rights to up to six of these products in China, excluding AMG 510, while rights on remaining products revert to Amgen. Amgen and BeiGene will share profits in China equally on these products until the rights revert to Amgen, after which Amgen will pay royalties to BeiGene on sales in China for a period of five years after reversion.
BeiGene has an established team in China, including a 700-person commercial organization and a 600-person clinical development organization. Overall, the company has over 3,000 employees in China, the US, Australia and Europe. BeiGene is advancing a pipeline consisting of oral small molecules and monoclonal antibodies for treating cancer, including targeted therapies, and immuno-oncology drugs, and combination cancer drugs.
Amgen says it will continue to commercialize its non-oncology product portfolio in China. Earlier this year, Amgen launched its first-ever product in China, Repatha (evolocumab), an LDL cholesterol-lowering treatment. Amgen says it expects to launch a number of other non-oncology medicines in China over the next several years, including Prolia (denosumab), which reduces the risk of fracture in postmenopausal women with osteoporosis.
The transaction is expected to close in early 2020 subject to BeiGene shareholder approval, the expiration or termination of waiting periods under all applicable antitrust laws, and satisfaction of other customary closing conditions. BeiGene says it has already received commitments from shareholders holding approximately 40% of its outstanding shares to vote in favor of the transactions. With its $2.7-billion equity stake in BeiGene, Amgen will nominate one person to serve on BeiGene’s Board of Directors.