Huadong Medicine Inks $307.5M Deal for Two Novel Autoimmune Therapies IMB-101 and IMB-102

On August 14, Huadong Medicine’s wholly-owned subsidiary, Hangzhou Huadong Medicine Co., Ltd. (hereinafter referred to as “Huadong Medicine”), entered into an exclusive product licensing agreement with South Korea’s IMBiologics (hereinafter referred to as “IMB”).

Under the terms of the agreement, Huadong Medicine has obtained an exclusive license for IMBiologics’ two global innovative products in the field of autoimmune diseases, IMB-101 and IMB-102, in 37 Asian countries including China (excluding Japan, South Korea, North Korea, and others). The license covers rights to development, registration, manufacturing, and commercialization. Huadong Medicine will pay IMBiologics a $6 million upfront payment, a $2 million technology transfer milestone payment, up to $307.5 million (approximately RMB 2.2 billion) in development, regulatory, and sales milestone payments, as well as tiered royalties on net sales in the high single-digit to low double-digit percentages.

Huadong Medicine will be responsible for the development, registration, manufacturing, and commercialization of the licensed products in the licensed territory. IMBiologics will continue to be responsible for the development and commercialization of IMB-101 and IMB-102 in other regions. This transaction becomes effective as of the date of signing of the agreement.

IMBiologics, headquartered in Suwon, Gyeonggi Province, South Korea, is a biotechnology company founded in August 2020. Leveraging its next-generation IgM platform technology, ePENDY, the company develops innovative immuno-oncology products and is committed to creating new therapeutic solutions for autoimmune diseases and cancer.

The focus of this transaction is the acquisition of exclusive licensing rights for IMBiologics’ two global innovative biologics for autoimmune diseases, IMB-101 and IMB-102, in 37 Asian countries including China (excluding Japan, South Korea, and North Korea).

IMB-101 is a bispecific antibody targeting OX40L and TNFα, involved in regulating inflammatory cytokines, promoting T cell and plasma cell differentiation as well as autoantibody production, thereby maintaining immune homeostasis. IMB-101 was initially co-developed by HK-Inno.N and Y-Biologics, two South Korean companies, and exclusively licensed globally to IMBiologics in 2020. In 2023, IMBiologics submitted an Investigational New Drug (IND) application for IMB-101 to the U.S. FDA, which was approved. Preclinical data demonstrated favorable efficacy and safety profiles in animal models.

IMB-101 is currently undergoing Phase I clinical trials in the United States for the treatment of rheumatoid arthritis. Globally, there are only two bispecific antibodies targeting the same mechanism under development; the other candidate is Sanofi’s SAR442970, which is in Phase II clinical trials for the treatment of hidradenitis suppurativa, minimal change disease, and focal segmental glomerulosclerosis.

IMB-102 is a monoclonal antibody targeting OX40L, currently in preclinical studies, with potential indications for moderate-to-severe atopic dermatitis and other autoimmune diseases.

It is understood that there are currently only five monoclonal antibody products targeting the same mechanism in global development. The most advanced candidate is Sanofi’s amlitelimab, which is in Phase III clinical trials for the treatment of moderate-to-severe atopic dermatitis. In addition to atopic dermatitis, Sanofi is also exploring the potential of amlitelimab for other indications, including asthma, hidradenitis suppurativa, alopecia areata, and systemic sclerosis.

Regarding this transaction, Gyongsik Ha, CEO of IMBiologics, stated: “We are delighted to have entered into licensing agreements with Huadong Medicine for IMB-101 and IMB-102. Huadong Medicine possesses the necessary infrastructure and development capabilities for antibody-based therapeutic research and development. Through close collaboration with Huadong Medicine, we will fully accelerate the global launch of IMB-101 and IMB-102 as innovative medicines.”

Liang Lv, Chairman and General Manager of Huadong Medicine, stated: “IMBiologics is a leading biotechnology company in South Korea, focused on the development of innovative antibodies for various autoimmune diseases. IMB-101 and IMB-102 target the innovative OX40L pathway and hold potential for treating multiple autoimmune conditions, such as rheumatoid arthritis and atopic dermatitis. This collaboration further expands Huadong Medicine’s autoimmune pipeline and strengthens its leading position in China’s immunology market. Moving forward, Huadong Medicine will leverage its clinical development, regulatory, and commercial capabilities to accelerate the development of these two products in the licensed territories.”

Since Huadong Medicine’s transformation, its innovative drug and medical aesthetics segments have consistently attracted significant attention. Within the innovative drug segment, Huadong Medicine has established a prominent reputation in GLP-1 and ADC therapies.

Currently, Huadong Medicine has established four major business segments: pharmaceutical manufacturing, pharmaceutical commerce, medical aesthetics, and industrial microbiology. Autoimmunity has become one of the three core therapeutic areas prioritized for development within Huadong Medicine’s pharmaceutical manufacturing segment. In recent years, Huadong Medicine has continuously deepened its strategic layout in the field of autoimmunity by introducing globally leading innovative technologies and products, while simultaneously enhancing its own innovative R&D capabilities.

According to Huadong Medicine’s 2023 annual report, the pharmaceutical manufacturing segment generated RMB 12.217 billion in revenue and RMB 2.33 billion in net profit attributable to shareholders of the parent company, accounting for as high as 85% of the total profit. Among these, the autoimmune disease segment was the biggest beneficiary.

Huadong Medicine has demonstrated unstoppable momentum in the field of autoimmune diseases and its topical formulation platform. After injecting capital into Quanxin Biologics in 2020, Huadong Medicine secured the Greater China rights to PRV-3279, a bispecific antibody for the treatment of systemic lupus erythematosus developed by Provention Bio, for nearly USD 190 million in February 2021. Subsequently, in February 2023, it acquired the exclusive rights to Kiniksa’s two global innovative autoimmune products, Arcalyst and Mavrilimumab, in 24 Asia-Pacific countries and regions, including China and South Korea (excluding Japan), for up to nearly USD 700 million.

Moreover, on July 19, Huadong Medicine announced that its wholly-owned subsidiary, Huadong Medicine (China & US) Pharmaceutical Co., Ltd., had secured exclusive rights for Quanxin Biologics’ QX005N product in the Greater China region. QX005N is an innovative monoclonal antibody independently developed by Quanxin Biologics that targets IL-4Rα and simultaneously inhibits signaling pathways and biological effects mediated by both IL-4 and IL-13. Currently, QX005N has obtained Investigational New Drug (IND) approvals in China for seven indications: moderate-to-severe atopic dermatitis in adults, atopic dermatitis in adolescents aged 12–17 years, prurigo nodularis, chronic rhinosinusitis with nasal polyps, chronic spontaneous urticaria, asthma, and chronic obstructive pulmonary disease (COPD), making it the IL-4Rα-targeted candidate with the largest number of IND-approved indications in China. Among these, Phase III clinical trials are underway for the two indications of moderate-to-severe atopic dermatitis in adults and prurigo nodularis.

In addition to biologics and small-molecule innovative drugs, Huadong Medicine has also expanded into topical formulations. In August 2023, Huadong Medicine first acquired exclusive rights for Arcutis’ autoimmune topical roflumilast products, including ZORYVE (roflumilast cream) and ARQ-154 (roflumilast foam), in Greater China and Southeast Asia for nearly $100 million. It then secured the rights for MC2’s psoriasis cream Wynzora in Greater China for $52 million. Notably, ZORYVE® foam (0.3%) received FDA approval for marketing in December 2023.

To date, Huadong Medicine has developed more than 10 innovative biologic and small-molecule products in the field of autoimmune diseases. The indications of its existing and pipeline products cover transplant immunology, systemic lupus erythematosus, psoriasis, atopic dermatitis, seborrheic dermatitis, recurrent pericarditis, cryopyrin-associated periodic syndromes, and other conditions, spanning therapeutic areas such as dermatology, rheumatology, cardiology, respiratory medicine, and transplantation. This positions Huadong Medicine as one of the pharmaceutical companies in China with the most comprehensive portfolio in the autoimmune disease sector.

Meanwhile, multiple early-stage immunology projects featuring novel targets and biological mechanisms, independently developed by the company’s innovative drug R&D center, are progressing smoothly.

The introduction of the two innovative biologics, IMB-101 and IMB-102, is expected to address the clinical needs of patients with autoimmune diseases in a targeted manner. This move will further expand the Company’s product pipeline in the autoimmune field, creating effective synergy and iteration with its existing products, thereby enhancing the Company’s core competitiveness in this therapeutic area. Furthermore, beyond their current indications, IMB-101 and IMB-102 hold potential for development in other autoimmune conditions, suggesting that their market opportunity is poised for continued expansion.