(Yicai Global) Feb. 15 -- Chinese drugmaker Kelun Pharmaceutical’s exclusive USD9.3 billion global licensing deal with US pharma giant Merck involving seven experimental oncological drugs has passed the US’ antitrust review and has now entered into force.

In December last year, Kelun-Biotech Biopharmaceutical, a holding subsidiary of Kelun Pharma, granted New Jersey-based Merck, which does business outside the US as Merck Sharp & Dohme, exclusive rights to research, develop, manufacture and commercialize the preclinical antibody-drug conjugate therapies in major markets outside of mainland China, Hong Kong and Macau.

Now that the deal has been found to be in accordance with the Hart-Scott-Rodino Antitrust Improvements Act, unit Kelun-Biotech Biopharmaceutical will be eligible to receive the first non-refundable upfront payment of USD175 million.

There will also be milestone payments and sales commissions after the drugs come onto the market, the Chengdu, southwestern Sichuan province-based parent firm said in December. If all the licenses are global exclusive ones and all the drugs successfully reach the shelves, the deal could be worth as much as USD9.3 billion, it added.

It is Kelun Pharma’s third licensing deal with Merck Sharp & Dohme since May last year to develop and commercialize cancer drugs outside of China. Kelun-Biotech has received down payments of USD82 million from the first two licenses, issued in May and July 2022, and will likely rake in milestone payments of nearly USD2.3 billion.

Unsurprisingly, Kelun Pharma is expecting net profit to surge by between 45 percent and 56 percent in 2022 from the year before to between CNY1.6 billion (USD250 million) and CNY1.7 billion.

Unmoved by the news, Kelun Pharma’s share price [SHE:002422] closed down 3 percent today at CNY29.20 (USD4.20).

Editor: Kim Taylor