(Yicai) Dec. 10 -- Shares in Shanghai Fosun Pharmaceutical surged as much as 6.7 percent in Hong Kong today after the Chinese pharmaceutical giant said it has granted US drugmaker Pfizer the global commercialization rights to a new insulin-regulating, weight-loss drug developed by one of its subsidiaries in a deal worth as much as USD2 billion.

Fosun Pharma’s Hong Kong-traded stock [HKG:2196] ended the day up 3.8 percent at HKD22.30 (USD2.80) apiece. Earlier in the day it hit HKD22.94. While on the mainland, the firm's share price [SHA:600196] closed up 3.1 percent at CNY28.32 (USD4).

Fosun Pharma’s subsidiary YaoPharma has agreed to grant Pfizer exclusive global rights to develop, use, produce and commercialize the oral small-molecule glucagon-like peptide-1 receptor agonist YP05002 and any products containing this active ingredient, Shanghai-based Fosun Pharma said yesterday.

YaoPharma will receive a non-refundable downpayment of USD150 million, it said. The company is also eligible for development milestone payments of up to USD350 million as the drug moves through the different stages of clinical trials and commercialization. Once the medicine enters the market, Chongqing-based YaoPharma could receive sales milestone payments of as much as USD1.5 billion based on net sales.

YP05002, the drug’s main active ingredient, works by activating the human GLP-1 receptor to promote insulin secretion in the pancreas and reduce glucagon levels. This suppresses the appetite and reduces energy intake through mechanisms such as influencing the central nervous system, Fosun Pharma said. Potential uses include long-term weight management, type 2 diabetes and metabolic dysfunction-associated steatohepatitis.

Fosun Pharma owns the independent intellectual property rights to the medicine which is undergoing Phase I clinical trials in Australia, it said.

This licensing agreement reflects New York-based Pfizer’s confidence in Fosun Pharma’s innovative drug research and development capabilities and will help speed up global clinical development and commercialization of the drug, benefiting more patients worldwide, it added.

Editor: Kim Taylor