Junshi BIO (ASX: 01877) has announced its intention to enter into a joint venture agreement with Suzhou Zhonghe, Junshi Engineering, Suzhou Junmeng, the joint venture company Shanghai Zhiyu Biopharmaceutical Co., Ltd., and Dr. Yao Sheng. Under this agreement, the transferors (the company, Suzhou Zhonghe, Junshi Engineering, and Suzhou Junmeng) conditionally agree to (i) grant a license for the licensed intellectual property to the joint venture company for purposes including the research, development, manufacturing, use, and commercialization of the licensed products; (ii) transfer tangible assets to the joint venture company; and (iii) transfer IP rights and interests to the joint venture company.
In consideration for the aforementioned, with a total consideration amount of approximately RMB 53.08 million, the joint venture company will issue new registered capital of RMB 250,000 to Junshi BIO. The licensed products refer to products independently developed by the joint venture company based on relevant antibody sequence(s) generated during the R&D process using the licensed technology. These include: (a) multi-specific antibody products (tri-specific and above); (b) conjugate products (AXC, i.e., antibody X conjugate); and (c) derivative products or substantially equivalent products.
The tangible assets consist of instruments, equipment, and supporting facilities located within the transferors' preclinical R&D laboratories. The IP rights and interests encompass all technological achievements, experimental data, and technical know-how related to the targets of the designated pipeline or reasonably expected to be used in the development of the licensed products. The designated pipeline involves the development of antibody technology and ADC platform technology for targets corresponding to three products in the field of oncology therapy.
Furthermore, the joint venture company has conditionally agreed to enter into a capital increase agreement with Dr. Yao Sheng and angel round investors. Under this agreement, the joint venture company conditionally agrees to subscribe for a total of RMB 468,750 in new registered capital for a total consideration of USD 15 million.
The subscription price per RMB 1 of registered capital by the angel round investors is approximately RMB 218.87, which is higher than the company's subscription price of RMB 212.32 per RMB 1 of registered capital for the joint venture. Upon completion of this financing round, Junshi BIO will hold a 14.55% stake, Dr. Yao Sheng will hold 34.91%, and the remaining equity will be held by the founding team, an employee持股 platform, and the angel investors.
The announcement states that the joint venture company possesses strong R&D capabilities and development potential. Dr. Yao Sheng, Mr. Deng Lingquan, and Mr. Liu Hongchuan are all professionals in the biopharmaceutical field, with extensive experience in innovative drug R&D, industrial转化, and biopharmaceutical investment and financing, respectively. They possess international scientific research backgrounds, practical experience in innovative drug development, and capabilities in industrial resource integration, having cumulatively participated in and led the R&D and上市 of multiple innovative生物药 projects.
With the financial support from the angel investors, the further development of the对标 intellectual property by the joint venture company is expected to benefit Junshi BIO by enabling it to gain from the subsequent R&D,上市, and commercialization of related drugs. Entering into the joint venture agreement and the contemplated transactions thereunder is conducive to the company optimizing its overall resource allocation, maintaining a focused and efficient investment in its R&D pipeline, and fully utilizing its existing patented achievements.
The rights and interests used for this capital contribution do not involve the company's existing commercialized product rights and are not expected to have a material adverse impact on the company's financial condition or operating results.
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