Yuhan Co. announced on July 1 that it has signed a US$870 million (1.25 billion won) contract with Boehringer Ingelheim to transfer its fusion protein (GLP-1/FGF21 dual agonist) technology for treatment of the non-alcoholic steatohepatitis (NASH) to the global pharmaceutical company.
Of the total amount, US$40 million is a non-refundable down payment, and US$10 million will be paid to Yuhan after the GLP-Tox (preclinical toxicity test). The total milestone payments that Yuhan will receive when the technology is commercialized amount to US$830 million.
The contract covers the whole world except for Korea. The contract term extends from the contract date to the expiration of the national patent right or 10 years from the initial sales date by country or the expiration of the monopoly period granted by the national licensing authority.
Yuhan said, "There is no obligation to return the down payment, and milestone fees can be collected when each milestone in the development and commercialization process is achieved." The revenue recognition of the technology transfer contract may vary depending on the success of clinical trials and licenses, and there is a chance that it may not be implemented,” the company added.
“In the event that clinical trials, licenses and commercialization are not completed, the technology transfer contract may be terminated, and we are not obliged to pay penalties upon termination of the contract. Under the contract, we will pay 5 percent of the total technology export amount to Genexine," the company said. Genexine is Yuhan’s partner in developing its fusion protein technology.