Hutchmed cashes in a Chinese JV to help fund its pipeline

Hutchmed has agreed to divest its share of a Chinese joint venture company through a pair of deals that will give it a cash injection of around $608 million.

The deal will see Hutchmed sell its 45% stake in Shanghai Hutchison Pharmaceuticals Ltd – a manufacturer of own-brand generic prescription cardiovascular medicines that operates mainly in the domestic Chinese market – to JV partner Shanghai Pharmaceuticals and private equity group GP Health Service Capital.

The JV was set up in 2001 and has become increasingly peripheral to Hutchmed's core business of developing novel therapies for cancer and immunological diseases, which include FDA-approved cancer drugs Elunate (fruquintinib) and Tazverik (tazemetostat).

In a statement, Shanghai-headquartered Hutchmed said that the divestment would help drug experimental therapies, including its antibody-targeted-therapy conjugate (ATTC) programmes.

At the moment, its ATTC candidates remain in early-stage development, but are a key focus for the company, which thinks they could be a "next-generation" to the current crop of antibody-drug conjugate (ADC) therapies on the market.

Its ATTCs combine antibodies with targeted therapeutics instead of cytotoxins, and in preclinical testing have shown "robust anti-tumour activity with [a] durable response following a single administration, and stronger anti-tumour activity compared to administration with the individual antibody and targeted therapy components, improving tolerability associated with targeted therapy," according to a company statement.

The new funding – which should be around $477 million after expenses and before taxes, and which is scheduled to close in the next three months – will help Hutchmed move the first of its ATTC candidates into clinical development in the second half of 2025, said the company.

Commenting on the transactions, Hutchmed chair Dr Dan Eldar said the drugmaker is now firmly focused on "capitalising on [...] two decades of deep research into oncogenic drivers of disease and discovering and developing highly optimised therapies, through [its] unique ATTC platform."

Lung cancer combination advances in China

In other news today, Hutchmed also said that China's National Medical Products Administration (NMPA) had started a priority review of cMET tyrosine kinase inhibitor Orpathys (savolitinib) in combination with partner AstraZeneca's EGFR inhibitor Tagrisso (osimertinib) in non-small cell lung cancer (NSCLC) patients with MET amplification after progression on first-line EGFR inhibitor therapy.

The addition of the cMET inhibitor is designed to overcome a key resistance mechanism that commonly emerges with first-line EGFR inhibitor treatment.

The filing – which triggers a milestone payment from AZ – is supported by the SACHI trial, which compared Orpathys and Tagrisso to platinum-based doublet-chemotherapy (pemetrexed plus cisplatin or carboplatin), currently the standard second-line therapy for this type of lung cancer.