Nhuanhua Pharmaceutical announced on September 29 that it has signed an exclusive license agreement with Somnivera, Inc., granting the latter exclusive rights to develop, manufacture and commercialize a clinical-stage investigational drug for sleep disorders worldwide outside mainland China, Hong Kong, Macau and Taiwan. Somnivera will pay a total upfront fee of $10.5 million, and Nhuanhua Pharmaceutical is entitled to receive up to $507 million in milestone payments, as well as tiered royalties calculated at a percentage ranging from single digits to low double digits of net sales. As part of the transaction consideration, the company will also obtain a 15% equity stake in Somnivera through its wholly owned subsidiary Hong Kong Nhuanhua Pharmaceutical Co., Ltd. The investigational drug is a Class 1 innovative drug independently developed by the company with proprietary intellectual property rights, and has received a drug clinical trial approval notice issued by the National Medical Products Administration. It is an important project in the company's central nervous system innovative research and development pipeline. The company cautioned that new drug development involves a long cycle and high risks, and that arrangements such as the upfront payment, milestone payments, royalties and equity are all subject to certain conditions, with the timing and amount ultimately realized still uncertain.
Somnivera gains exclusive worldwide rights to develop and commercialize Nhuanhua's clinical-stage sleep drug, expanding its pipeline via the license deal.
