HCM - Takeda to acquire rights to Hutchmed's cancer drug fruquintinib for $400M upfront

Takeda ( NYSE: TAK ) signed a licensing agreement with Hutchmed (China) ( NASDAQ: HCM ) to develop and commercialize oral cancer drug fruquintinib outside of mainland China, Hong Kong and Macau.

Under the agreement, Takeda will pay $400M upfront, up to $730M in additional potential payments in regulatory, development and commercial milestones, plus royalties on net sales.

The Japanese drugmaker will get an exclusive worldwide license to develop and commercialize fruquintinib in all indications and territories outside of mainland China, Hong Kong and Macau.

Hutchmed noted that fruquintinib was approved in China in 2018 and is an inhibitor of vascular endothelial growth factor receptors (VEGFR) -1, 2 and 3. Fruquintinib is orally administered and has the potential to be used across subtypes of refractory metastatic colorectal cancer (CRC), regardless of biomarker status.

In August 2022, fruquintinib met the main goal of overall survival in patients with advanced, refractory metastatic colorectal cancer (CRC) in a phase 3 trial called FRESCO-2.

However in November 2022, the drug met one main goal but did not reach statistical significance in another goal of a late stage study, dubbed FRUTIGA, in Chinese patients with advanced gastric or gastroesophageal junction (GEJ) adenocarcinoma.

The transaction is subject to closing conditions, including antitrust reviews.

Hutchmed added that in December 2022, it started a rolling submission of a new drug application (NDA) for fruquintinib with the U.S. FDA, which is expected to be completed in H1 2023. Filing are also planned in the EU and Japan.

Fruquintinib is marketed as Elunate by Hutchmed with Eli Lilly ( LLY ). The drug is not approved for use outside of China.

HCM +3.35% to $17.90 premarket Jan. 23

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