ADC Sector Surges with Breakthrough Designations, Global Licensing Deals, and IPO Filings

　　【Pharmaceutical Network Industry DynamicsRecently, the ADC industry, which has been developing vigorously, has reported frequent successes, including Daiichi Sankyo/AstraZeneca's key ADC receiving another Breakthrough Therapy Designation, Escugen’s participation in the development of a First-in-Class ADC successfully licensed overseas, and Puzhong Discovery announcing a licensing agreement with ADCendo ApS for ADCE-T02.
 

On August 20, Daiichi Sankyo announced that Enhertu (trastuzumab deruxtecan), a重磅 antibody-drug conjugate (ADC) jointly developed with AstraZeneca (AZN.US), had been granted Breakthrough Therapy Designation (BTD) by the U.S. FDA for the treatment of patients with unresectable or metastatic breast cancer that is hormone receptor (HR)-positive, HER2-low (IHC 1+ or IHC 2+/ISH-) or HER2-ultra-low (defined as IHC 0 with membrane staining). These patients have received two lines of endocrine therapy for their metastatic disease, or experienced disease progression within six months after receiving first-line endocrine therapy combined with a CDK4/6 inhibitor, or within 24 months after receiving adjuvant endocrine therapy.
 

In addition to the good news in the U.S. market, Daiichi Sankyo also announced that the European Medicines Agency (EMA) has accepted the regulatory application for a new indication of Enhertu, which will evaluate Enhertu as a monotherapy for adult patients with unresectable or metastatic HER2-low or ultra-low expressing breast cancer who have received at least one prior endocrine therapy for metastatic disease.
 

On the same day, Puzhong Discovery and ADCendo ApS jointly announced that they had reached a licensing agreement for ADCE-T02 (Puzhong Discovery's R&D code: AMT-754). ADCendo will obtain global development and commercialization rights outside of Greater China, while Puzhong Discovery will retain the development and commercialization rights in Greater China (including mainland China, the Hong Kong Special Administrative Region, the Macao Special Administrative Region, and Taiwan, China). According to the terms of the agreement, Puzhong Discovery will receive tens of millions of US dollars as an upfront payment. Upon achieving subsequent development, regulatory, and commercial milestones, it will receive total milestone payments exceeding 1 billion US dollars, as well as royalties in the single-digit to low double-digit percentage range based on net sales (excluding Greater China).
 

As early as the end of July, Escugen and Yu Yan Technology jointly announced that Yu Yan Technology, as the signing representative, signed an agreement with French Ipsen Pharma SAS ("Ipsen") on July 11 regarding the previously co-developed first-in-class ADC drug FS001/ESG408, granting Ipsen global rights for development, production, and commercialization. It was introduced that the pipeline FS001/ESG408 authorized to Ipsen this time is the result of the strong collaboration between Escugen and Yu Yan, leveraging their respective strengths to jointly develop. According to the licensing agreement, based on successful development and regulatory approval, both parties are expected to share up to $1.03 billion in funds, including upfront payments, R&D, regulatory and commercial milestone payments, as well as tiered royalties on global sales post-commercialization.
 

With the entry of major pharmaceutical companies, the market size of ADC drugs is continuously growing. Data shows that from 2019 to 2022, the global ADC drug sales scale increased from $2.8 billion to $7.9 billion. It is estimated that from 2023 to 2030, the global ADC drug market is expected to grow from $11.4 billion to $64.7 billion, with an average annual compound growth rate of 30%.
 

Industry insiders predict that global ADC drug licensing transactions will continue to expand rapidly. According to disclosed data, by 2023, the total amount of global ADC drug out-licensing transactions has reached 55.5 billion US dollars, increasing more than 60 times compared to 2018. In this process, China's innovative enterprises will play an increasingly important role in the ADC drug research and development field, and domestically produced ADCs are expected to accelerate their expansion overseas.
 

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