Big BD Deal: Roche Bets Over $1.5 Billion on Hansoh Pharma's CDH17-Targeting ADC, Reflecting MNCs’ Strategic Anxiety?

The feast of innovative drug BD is still "updating".

In the past two days, five BD deals have been successively disclosed in the industry, involving five pharmaceutical companies: Hansoh Pharma, Prugene, Vibe Bio, Ascletis, and Haihe Biopharma. The total amount exceeds 4.2 billion US dollars. The transactions mainly focus on drugs with high technical barriers and unmet clinical needs. Some large first-line MNCs are also involved, such as the cooperation between Hansohn Pharma and the Swiss pharmaceutical giant Roche.

According to the announcement by Hansoh Pharma, its wholly-owned subsidiaries, Shanghai Hansoh Biomedical Technology Co., Ltd. and Changzhou Hengbang Pharmaceutical Co., Ltd. (Licensor), entered into a licensing agreement with F. Hoffmann-La Roche Ltd (Licensee), a subsidiary of Roche.

According to the licensing agreement, the licensor will grant the licensee an exclusive global license (excluding mainland China, Hong Kong, Macao, and Taiwan) for the development, production, and commercialization of HS-20110. The licensor will receive an upfront payment of $80 million and is eligible to receive up to $1.45 billion in milestone payments based on the product's development, regulatory approval, and commercialization progress, as well as tiered royalties on future potential product sales.

Following the announcement, the share price of Hansoh Pharma also showed an upward trend, opening nearly 4% higher today and closing at HK$36.5 per share.

Speaking of which, BD has become an important development method for Hansoh Pharma. Before Roche, the company had already achieved out-licensing deals with multinational pharmaceutical giants such as GSK, Merck, and Regeneron. So, what are the demands of MNCs? What are the core selling points of Hansoh Pharma?

The "Defend Territory" Demand of MNCs Behind BD

The sense of crisis among MNCs is often a key factor driving the overseas expansion of China-produced innovative drugs through BD.

In this strategic cooperation between Hansoh Pharma and Roche, the latter actually has an increasingly obvious sense of crisis.

Roche has always been a leading enterprise and seasoned player in the antibody-drug conjugate (ADC) field, holding multiple highly influential ADC products.

For example: Kadcyla (Trastuzumab Emtansine), which targets HER2-positive breast cancer, was approved by the U.S. FDA in 2013 and became the third ADC to be marketed globally and the first HER2 ADC. By 2018, its global sales had exceeded $1 billion, and in 2021, sales surpassed $2 billion, consistently ranking at the top of the ADC sales charts for many years. The second ADC product, Polivy (Polatuzumab Vedotin), was approved for marketing in 2019 for patients with relapsed or refractory diffuse large B-cell lymphoma (DLBCL) who had received at least two prior treatment regimens. In 2023, the product's sales also broke through the $1 billion mark… These products have solidified Roche's leading position in the ADC field.

However, there are no permanent winners in the track, and the peak period of products will always pass.

In recent years, as other pharmaceutical companies have accelerated the development of a new generation of ADC drugs (such as AstraZeneca and Daiichi Sankyo's HER2 ADC drug Enhertu, which can be used to treat adult patients with unresectable or metastatic HER2-low breast cancer), capturing the market with more prominent efficacy or lower pricing, the pressure on Roche's core products has become increasingly prominent, with a sense of tension that is hard to conceal.

Roche CEO Severin Schwan at the 2024 JPM Conference (J.P. MorganHealthcareHealth Conference) once publicly stated: "We plan to carry out more transactions and intend to focus on internal work in ADC." This collaboration between Roche and Hansoh Pharma is clearly aimed at supplementing the product pipeline and further enhancing competitive advantages in the ADC field.

Hansoh Pharma's innovation strength once again became the focus.

Innovative drugs have become the foundation of Hansoh Pharma.

In the pharmaceutical industry's practice of "transitioning from imitation to innovation," Hansoh Pharma stands out as a relatively successful case.

It is reported that in 2002, the heyday of generic drugs, Hansoh Pharma embarked on the research and development of Class 1.1 innovative drugs. To date, Hansoh Pharma's portfolio of innovative drugs has become relatively extensive. According to the half-year report, Hansoh Pharma is currently focusing on major disease treatment areas such as oncology, anti-infectives, central nervous system, metabolism, and autoimmune disorders, advancing the development of related products. Currently, there are seven innovative drugs generating sales revenue in China, among which are several leading products.

For example, Almontri® (Amethinib Mesylate Tablets) is the first domestically developed third-generation EGFR-TKI innovative drug in China independently researched by Hansoh Pharma. It is suitable for treating "patients with locally advanced or metastatic non-small cell lung cancer (NSCLC) who have progressed after previous treatment with epidermal growth factor receptor (EGFR) tyrosine kinase inhibitors (TKI) and are positive for the T790M mutation," among other indications.

In addition, as a Level I or first-line recommendation, this product has been included in eight national treatment guidelines, including the "CSCO Non-Small Cell Lung Cancer Diagnosis and Treatment Guidelines (2025 Edition)" by the Chinese Society of Clinical Oncology (CSCO).

Hausen Xinfu® (Flumatinib Mesylate Tablets) is China's first domestically developed novel second-generation TKI for the treatment of Chronic Myeloid Leukemia (CML). According to existing clinical trial results, Hausen Xinfu® achieves molecular response more quickly and deeply with a favorable safety profile.

Such innovative drugs with a certain level of competitiveness have also become the core driver for the company's continuous performance growth. According to the financial report, in the first half of this year, Hansoh Pharma achieved an income of approximately 7.434 billion yuan, representing a year-on-year increase of about 14.3%; a profit of approximately 3.135 billion yuan, marking a year-on-year growth of about 15.0%; and a basic earnings per share of approximately 0.53 yuan, reflecting a year-on-year increase of about 14.8%. Among this, revenue from innovative drugs and collaborative products reached approximately 6.145 billion yuan, growing by 22.1% year-on-year, and accounting for about 82.7% of total revenue.

At the same time, Hansoh Pharma continues to explore the value of its innovative R&D pipeline for overseas business development (BD), and has indeed found a new growth path. For instance, in December 2024, Hansoh Pharma announced the global licensing of HS-10535, a preclinical oral small molecule GLP-1 receptor agonist, to Merck. In the first half of this year, Hansoh Pharma also received an upfront payment of $112 million as part of the BD licensing fee from Merck.

The product asset HS-20110 that Roche is interested in this time is also a promising candidate. According to Hansoh Pharma, HS-20110 is an investigational CDH17-targeted ADC drug currently undergoing global Phase I clinical trials in China and the United States for the treatment of colorectal cancer (CRC) and other solid tumors.

It is reported that CDH17, a member of the cadherin superfamily (a group of calcium-dependent cell adhesion molecules that are crucial for organ development, tissue integrity, and cancer progression), shows high expression in gastrointestinal tumors such as gastric cancer, colorectal cancer, and pancreatic cancer. It has been regarded as a key direction to break through the treatment bottlenecks of these diseases.

Given the large demand from patients and the cutting-edge nature of the product, both Roche and Hansoh Pharma are optimistic about the application prospects of HS-20110, but can they secure the leading position?

Crowded track, overly new technology, requires BD efforts

How large is the potential application market for CDH17-targeted ADC drugs?

In terms of colorectal cancer alone, according to the 2024 data from the World Health Organization (WHO), the number of new cases of colorectal cancer has risen to the second most common malignant tumor, second only to lung cancer. By region, the incidence is higher in developed countries in Europe and America, but in recent years, the growth rate in Asian countries (especially China) has been significant. The latest data released by the National Cancer Center in 2024 shows that there are more than 510,000 new cases of colorectal cancer in China each year, with both the incidence and mortality rates ranking among the top five, and this number is increasing annually.

In response to the growing demand, a number of pharmaceutical companies have made CDH17-targeted ADC products a key focus of their development. It is reported that at the 2025 American Association for Cancer Research (AACR 2025) annual meeting, more than ten China-based pharmaceutical companies, including Mabwell, Simcere, Yilian Biotechnology, LaNova Medicines, and Orange Sail Pharmaceuticals, will present the latest advancements of their CDH17 ADCs in abstract form.

This also means that the track targeted by Hansoh Pharma and Roche is becoming increasingly crowded. It is worth mentioning that, since the CDH17 target is relatively new, most of the related drugs under research are still in the early clinical stages. There isn't a significant gap between pharmaceutical companies, but there is still competitive pressure.

BD collaborations like those between Hansoh Pharma and Roche may already be an essential "accelerator" for new drug development.

Source: Medical Research Society

       Title: Another BD Mega Deal! Roche Bets Over $1.5 Billion on Hansoh Pharma, A Case of "Anxiety-Driven Investment" by MNCs?