Pfizer Inc. (NYSE:PFE), a pharmaceutical giant with $62.46 billion in revenue and a market capitalization of $130.76 billion, has secured an exclusive licensing agreement with Chinese biopharmaceutical firm 3SBio Inc. (01530.HK) for the development and commercialization of a novel cancer therapy, SSGJ-707, outside of China. This bispecific antibody, which targets PD-1 and VEGF, is currently being tested in China for various cancers including non-small cell lung cancer, metastatic colorectal cancer, and gynecological tumors.
The deal, which excludes China but provides Pfizer with an option for commercialization rights within the country, involves an upfront payment of $1.25 billion to 3SBio. Additional milestone payments could reach up to $4.8 billion, alongside tiered double-digit royalties on future sales if the drug receives approval. With a strong dividend yield of 7.48% and a history of maintaining dividend payments for 55 consecutive years, Pfizer demonstrates robust financial stability for such significant investments.
Pfizer’s commitment includes a $100 million equity investment in 3SBio, contingent on the closure of the transaction and a securities subscription agreement. The expected closure is set for the third quarter, pending regulatory and 3SBio shareholder approvals.
The agreement leverages Pfizer’s manufacturing capabilities, with plans to produce the drug substance in Sanford, North Carolina, and the drug product in McPherson, Kansas. Meanwhile, 3SBio is gearing up to initiate the first Phase 3 study in China in 2025.
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