LG Chem in $95.5 million drug out-licensing deal with China’s Innovent

LG Chem Life Sciences, the biopharmaceutical unit of LG Chem Ltd., and China’s biotech company Innovent Biologics have entered into a strategic collaboration and licensing agreement regarding LG’s Tigulixostat, a late-stage novel gout treatment.

Under the deal, Innovent will obtain exclusive rights to develop and commercialize Tigulixostat in China, the South Korean company said on Thursday.

In return, LG Chem will receive up to $95.5 billion, including $10 million upfront, $85.5 million in milestone payments, plus tiered royalties on net sales of the product in China.

Through the collaboration, LG will see increased opportunities for commercialization of the gout treatment in the Chinese market, while concentrating on the US and European markets with other partners.

Tigulixostat is a drug that inhibits Xanthine Oxidase, an enzyme that generates uric acid. LG Chem is conducting phase 3 clinical trials on 3,000 patients in the US, Europe and other countries.

LG Chem also planned to conduct clinical trials in China, but withdrew its plan last month following tougher requirements by the Chinese authorities on the tests.

Tigulixostat has demonstrated sufficient efficacy and a good safety profile in a phase 2 study, according to LG.

TWELVE NOVEL DRUG CANDIDATES IN PIPELINE

LG Chem Life currently has a total of 12 drug candidates in the pipeline, of which four are anticancer therapies.

LG said it expects to bring Tigulixostat to market by 2027. If the gout treatment drug is released as scheduled, it will be LG’s first new medicine in 15 years -- its antidiabetic drug Zemiglo came out in 2012.

Listed on the Hong Kong stock exchange, Innovent’s market capitalization stands at about 8 trillion won ($6.1 billion).

In 2018, seven years after the founding of the company, it acquired marketing approval for its immuno-oncology medicine, Tyvyt, in China. In the following year, the new medicine was registered with the Chinese drug authorities.

With some 1,500 researchers and 3,000 sales and marketing personnel, Innovent has commercialized eight products in China.

“We will continuously expand competitive new drug pipelines through aggressive investments to become a global innovative pharmaceutical company,” said Son Jee-woong, president of LG Chem Life Sciences.

Write to Jae-young Han at jyhan@hankyung.com
In-Soo Nam edited this article.