(Yicai) Aug. 16 -- Huadong Medicine’s stock price jumped after the Chinese pharmaceutical firm said a unit has acquired the exclusive rights to develop and commercialize two autoimmune disease drug candidates of South Korea’s IMBiologics in most of Asia.

Huadong’s shares [SHE: 000963] ended 6 percent higher at CNY30.25 (USD4.22) each, just off their high for the day. The broader Shenzhen market fell 0.2 percent.

Zhongmei Huadong Pharmaceutical signed a contract on Aug. 14 for the rights to IMBiologics' IMB-101 and IMB-102 in 37 Asian countries, except South Korea, North Korea, and Japan, its parent company said yesterday. The unit will pay a USD6 million downpayment, USD2 million in technology transfer fees, and as much as USD307.5 million in milestone payments.

Huadong has been acquiring the regional rights to innovative drugs in recent years to expand the Hangzhou-based company’s drugs pipeline. Suwon-based IMBiologics focuses on developing new treatments for autoimmune diseases and cancers, Huadong pointed out.

After the launch of the two new drugs, Zhongmei Huadong will also pay commissions to IMBiologics that are equal to as much as a double-digit percentage of net sales based on their sales performance, the firm added.

IMB-101 and IMB-102 are global innovative biologics that treat autoimmune diseases. IMB-101 is in Phase I clinical trial in the United States and is intended for treating rheumatoid arthritis, while IMB-102 is in preclinical development, with potential indications for moderate to severe atopic dermatitis and other autoimmune diseases.

The drugs can expand Huadong’s product pipeline in treating autoimmune diseases and form an effective business synergy with its existing products, it said, adding that they also have the development potential to apply to other indications for autoimmune diseases.

Editor: Martin Kadiev