(Yicai) May 12 -- Shares of Hengrui Pharmaceutical rose after the Chinese drugmaker said it signed a deal worth up to USD15.2 billion with US peer Bristol Myers Squibb to co-develop innovative drugs.

Hengrui [SHA: 600276] closed 4.8 percent up at CNY56.11 (USD8.25) in Shanghai today, after earlier hitting the exchange-imposed daily trading limit of 10 percent. Its Hong Kong-listed stock [HKG: 1276] climbed as much as 16.2 percent and then closed up 5.7 percent at HKD69.40 (USD8.86).

Hengrui and BMS will jointly advance the research, clinical trials, and commercialization of 13 early-stage innovative drugs, the Chinese firm announced today. They are four of Hengrui’s oncology and hematology innovative drugs, four of BMS’s immunology innovative drugs, and five other innovative drug projects planned for co-development.

Under the agreement, Hengrui will receive exclusive rights to the 13 projects in the Chinese mainland, Hong Kong, and Macao, while BMS will get the rights for all global territories outside China.

BMS will pay Hengrui USD950 million in cooperation fees -- an upfront payment of USD600 million, a first annual cooperation payment of USD175 million in 2027, and a second conditional annual payment of USD175 million in 2028 -- and milestone payments based on Hengrui’s options for joint research and development projects and the achievement of corresponding development, registration, and commercialization targets, for a total of up to USD15.2 billion.

Moreover, after the launch of the new drugs, Hengrui will also be entitled to tiered royalty payments from BMS based on the net sales generated in markets outside China.

The deal, which is still subject to regulatory approval under the US Hart-Scott-Rodino Antitrust Improvements Act and other customary closing conditions, is expected to be completed in the third quarter of this year.

The partnership fully integrates BMS’s differentiated R&D strengths, global clinical development expertise, regulatory proficiency, and large-scale commercialization capabilities with Hengrui’s robust drug development and efficient early-stage research capabilities, accelerating the progress of high-value innovative drug projects, the Chinese company noted.

Editor: Futura Costaglione