ReNeuron partners with Fosun Pharma in China

Shares of UK cell-based therapies company ReNeuron (AIM: RENE) leapt as much as 30% after it said it has signed an exclusive licence agreement with Shanghai Fosun Pharmaceutical Industrial Development, a subsidiary of Shanghai Fosun Pharmaceutical, for the development, manufacture and commercialization of ReNeuron’s CTX and hRPC cell therapy programs in the People’s Republic of China.

ReNeuron will receive £6.0 million ($7.9million) on entering into the agreement, up to £6.0 million in near-term operational milestones and up to £8.0 million in future regulatory milestone payments. In addition, post-launch profit threshold milestone payments are due at a rate of 5% of annual net profits derived from the licensed products in the year the relevant net profit milestones are exceeded, leading to total estimated milestone payments of £80.0 million provided all milestones and profit thresholds are successfully met.

ReNeuron will also receive tiered royalties at rates between 12% and 14%on sales of the licensed products in the Chinese market. The company will be responsible for supplying CTX and hRPC cells to Fosun until technical transfer activities have been completed.