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By Sriparna Roy
(Reuters) -Merck has signed a licensing agreement for a heart disease drug with Jiangsu Hengrui Pharmaceuticals worth up to $2 billion, the latest in a series of deals U.S. drugmakers have recently signed with China-based firms.
Large drugmakers including Merck and Eli Lilly have turned to Chinese biotechs for deals that give them access to new drugs for a cheaper investment, analysts have said.
Most recently, Danish drugmaker Novo Nordisk bought global rights to China-based United Laboratories International's weight-loss drug candidate in a deal worth up to $2 billion.
Merck last year signed a licensing deal worth up to $2 billion for Chinese biotech Hansoh Pharma's experimental oral drug to treat obesity. It also bought the rights to an early-stage cancer drug from China's LaNova in an up to $3.3 billion deal.
China continues to be an interesting source of recently struck licensing deals, as more innovations at low costs are coming out of the region, said Kevin Gade, chief operating officer at Bahl & Gaynor, which owns Merck shares.
Under the latest deal, announced on Tuesday, Merck will get exclusive rights to develop, manufacture and sell Jiangsu Hengrui Pharmaceuticals' experimental oral heart disease drug, HRS-5346, worldwide, except in the Greater China region.
The drug, currently being studied in a mid-stage trial in China, belongs to a class of drugs which prevent formation of cholesterol, fats and proteins in the blood, which can limit the blood flow to vital organs resulting in heart attack, stroke and other cardiovascular diseases.
Hengrui Pharma will receive an upfront payment of $200 million and will be eligible for up to $1.77 billion if it meets certain development, regulatory and commercial milestones, as well as royalties on net sales of HRS-5346, if approved.
The deal is expected to close in the second quarter of 2025.
(Reporting by Sriparna Roy in Bengaluru; Editing by Shounak Dasgupta and Shinjini Ganguli)
