ABVC Signs a Term Sheet to Earn Licensing Fees of up to $20M and Royalties of 5-12% of Net Sales

  ABVC Biopharma, Inc. (NASDAQ: ABVC), a clinical-stage biopharmaceutical company developing therapeutic solutions in oncology/hematology, neurology, and ophthalmology, today announced the signing of a legally binding term sheet with a prominent Chinese pharmaceutical company, Xinnovation Therapeutics Co., Ltd that, subject to definitive agreements, is for the exclusive licensing of ABV-1504 for Major Depressive Disorder (MDD) and ABV-1505 for Attention-Deficit/Hyperactivity Disorder in mainland China.

Under this landmark agreement, Xinnovation Therapeutics Co., Ltd will hold exclusive rights to develop, manufacture, market, and distribute our innovative drugs for MDD and ADHD in the Chinese market and shall bear the costs for clinical trials and product registration in China. The licensing deal carries a possible aggregate income of $20 million for ABVC. The term sheet outlines the key terms and conditions of the licensing agreement. The final agreement, expected to be formally signed within one year, will specify the precise licensing terms, including the schedule for milestone payments and other financial arrangements. As per the term sheet, ABVC expects to receive royalty payments ranging from 5% to 12% based on the projected annual net sales of licensed drugs in China, which we believe would bring ABVC's revenue ~$50 million annually and ~$1 billion during the patent life of these products, if we achieve the expected amount of sales. The final agreement is subject to the satisfaction of closing conditions, and the transaction will not occur if they are not satisfied or waived within one year.

https://finance.yahoo.com/news/abvc-signs-term-sheet-earn-123000150.html