- Pfizer Inc. (NYSE: PFE) subsidiaries and Cstone have announced a collaboration that involves a $200 million equity investment by Pfizer in CStone
Pfizer Inc. (NYSE: PFE) subsidiaries Pfizer Investment Co. Ltd. and Pfizer Corporation Hong Kong Limited and CStone Pharmaceuticals (HKEX: 2616) have announced the formation of a strategic collaboration that encompasses a $200 million equity investment by Pfizer Hong Kong in CStone, a collaboration between CStone and Pfizer Investment for the development and commercialization of CStone’s sugemalimab (CS1001, PD-L1 antibody) in mainland China, and a framework between CStone and Pfizer Investment to bring additional oncology assets to the Greater China market.
This collaboration essentially provides financing to support CStone’s development of sugemalimab, a potential best-in-class PD-L1 antibody that is being developed for high-incidence cancer indications in China, including lung, gastric, and esophageal cancers, among others. And Pfizer will in-license and exclusively lead commercialization of sugemalimab in China, harnessing its industry-leading capabilities to help doctors and patients across a far wider range of regions gain greater access to this treatment. This collaboration positions CStone and Pfizer to develop and commercialize additional oncology assets for the Greater China market.
Sugemalimab is an investigational anti-PD-L1 monoclonal antibody discovered by CStone. It is authorized by a company based in the U.S., Ligand Pharmaceuticals Inc. (NASDAQ: LGND). Sugemalimab is developed using the OmniRat transgenic animal platform — which can generate fully human antibodies in one stop. And as a fully human, full-length anti-PD-L1 monoclonal antibody, sugemalimab mirrors the natural G-type immunoglobulin 4 (IgG4) human antibody, which may reduce the risk of immunogenicity and toxicities in patients, a potentially unique advantage over similar drugs.
Sugemalimab completed a Phase I dose-escalation study in China. And during Phase 1a and 1b stages of the study, sugemalimab showed antitumor activity in multiple tumor types and was well-tolerated.
Currently, sugemalimab is being investigated in a number of ongoing clinical trials. And in addition to a Phase I bridging study in the U.S., the clinical programs in China include one multi-arm Phase Ib study for several tumor types, one Phase II registrational study for lymphoma, and four Phase III registrational studies, respectively, for stage III/IV non-small cell lung cancer, gastric cancer, and esophageal cancer.
Through the deal, Pfizer will obtain exclusive commercialization rights to sugemalimab in mainland China while CStone continues to lead clinical development and regulatory strategy for five selected indications. And CStone is entitled to receive up to $280 million in milestone payments for sugemalimab and additional tiered royalties. CStone is going to retain all development and commercialization rights to sugemalimab outside mainland China.
Pfizer is going to invest $200 million, consisting of 115,928,803 CStone shares at a price of US$1.725 per share (approximately HK$13.37 per share). And as a result of its equity investment, Pfizer will hold a 9.9% percent stake in CStone.
Together, CStone and Pfizer will select late-stage (post proof-of-concept) oncology assets for co-development in the Greater China market. And these assets may come either from Pfizer’s pipeline or through joint in-licensing.
Plus CStone and Pfizer may pursue on a selected basis joint in-licensing arrangements for additional oncology assets for the Greater China market.
The transaction has received the necessary internal approvals of both companies. And closing is not subject to approval by CStone’s shareholders.
Goldman Sachs & Co. LLC is acting as financial advisor to CStone. And Cooley LLP served as legal advisor. Clifford Chance LLP served as Pfizer’s legal advisor.
KEY QUOTES:
“Pfizer’s investment in CStone is a statement of its confidence in the potential of our anti-PD-L1 treatment and recognition of our research and development capabilities. By joining forces with Pfizer and leveraging its commercialization infrastructure, we will ensure that patients across a vastly expanded number of markets in China have quicker access to our highly differentiated PD-L1 treatment. In addition, we have advanced our transformation into a full-fledged biopharmaceutical company by forging a collaboration that will enable us to accelerate development and commercialization of globally innovative therapies for Chinese patients.”
— Frank Jiang, M.D., Ph.D., Chairman and Chief Executive Officer of CStone
“Our company has an extensive and proud history of bringing innovative medicines to patients in China. This collaboration with CStone builds on that history by helping to develop a potential best-in-class PD-L1 treatment that we can commercialize upon approval. It also fosters our collaboration with a partner that has exceptional clinical development capabilities that can help us meet the clear need for novel oncology treatments in China.”
— Pierre Gaudreault, Acting President of Pfizer Biopharmaceuticals Group China
