Novartis Intensifies China Investments with New In-Licensing of Domestic Anti-Cancer Drug from Baiyu Pharma

　　【Pharmaceutical Network Enterprise NewsIn recent years, China has provided strong support to innovative drug companies in terms of policies and funding, driving the rapid rise of the innovative drug industry. Many drugs with novel mechanisms have successfully passed clinical trial verification, demonstrating promising clinical data and commercialization potential, which has also attracted the attention and investment of multinational pharmaceutical companies.
 

On October 16, it was reported that Chengdu Baiyu Pharmaceuticals Co., Ltd. and Novartis had signed a licensing agreement for a small molecule anti-cancer drug. According to the agreement, Novartis will obtain global development and commercialization rights for this innovative small molecule drug. In return, Novartis will pay Chengdu Baiyu Pharmaceuticals Co., Ltd. an upfront payment of 70 million US dollars, up to 1.1 billion US dollars in development, registration, and commercialization milestone payments, as well as corresponding royalties.
 

Data shows that the headquarters of Chengdu Baiyu Pharmaceuticals Co., Ltd. is located in Chengdu, Sichuan. The company focuses on drug research and development in four major fields: the central nervous system, oncology, autoimmune diseases, and anti-aging. Among these, the company has successfully developed modern botanical drugs (active ingredient preparations of Ginkgo biloba leaves), such as "Ginkgolide Injection" and "Total Ginkgo Lactone Pills."
 

According to the R&D pipeline disclosed on the company's website, the product with relatively rapid development progress is BY1298, which targets DNA-PK and is code-named for the treatment of solid tumors. The focus area is DNA damage, and the current monotherapy or combination therapy has reached the phase II clinical research stage.
 

The company stated on its website that most of the current chemotherapy and radiotherapy treatments basically work by damaging the DNA of tumor cells. The upregulation of DDR pathways provides tumor cells with a way to evade damage and resist death. Therefore, if chemotherapy or radiotherapy can be combined with drugs that target and inhibit the DNA repair mechanism, it is expected to overcome the resistance of tumors to treatment and significantly enhance efficacy.
 

However, the company has not yet disclosed which product is involved in this collaboration with Novartis. It only stated that this marks an important step in providing potentially effective anti-tumor drugs to patients worldwide, and expressed anticipation for positive outcomes.
 

For Novartis, the introduction of this investigational anti-tumor drug may further enrich its product pipeline. In fact, since 2024, Novartis has been aggressively "shopping" in China. In addition to this acquisition, in January this year, Novartis announced the acquisition of Sinopharm Xirui Pharmaceutical to strengthen the company's presence in the renal disease field. In the same month, Novartis also reached two deals with Bowang Pharmaceuticals potentially worth up to $4.165 billion in total, aiming to enhance its cardiovascular portfolio.
 

It is reported that Novartis, which successfully spun off its generics business in 2023, has gradually transformed into an innovative drug company. In recent years, the company has continuously streamlined its operations by eliminating diagnostic, vaccine, animal, consumer, and eye care businesses. It also spun off its generics business, Sandoz, in 2023 while cutting costs and improving efficiency (layoffs, organizational restructuring), selling pipelines, and focusing on developing innovative drugs with high profit potential. Currently, the company's key therapeutic areas have been adjusted to four: Cardiovascular-Renal-Metabolism, Immunology, Neuroscience, and Oncology.
 

After its transformation, Novartis achieved an impressive performance, according to the company's financial report for the first half of 2024. The company reported total revenue and net profit of $24.3 billion and $5.9 billion, respectively, representing year-over-year growth of 11% and 43% at constant exchange rates. This success was primarily driven by double-digit growth across its four major therapeutic areas. Specifically, Oncology, Immunology, Cardiovascular-Renal-Metabolism, and Neuroscience generated sales of $6.984 billion (+14%), $4.403 billion (+21%), $4.111 billion (+37%), and $2.234 billion (+39%), respectively.
 

Disclaimer: In no event shall the information or opinions expressed in this article constitute investment advice to any person.