AMGN Amgen Inc

By Allison Prang and Jared S. Hopkins 

U.S. pharmaceutical company Amgen Inc. said it is buying a roughly 20% stake in a Chinese biotechnology company for $2.7 billion in cash, further demonstrating China's emergence as a key market for foreign pharmaceutical companies.

Amgen said BeiGene Ltd., a Beijing-based company focused on oncology, is going to commercialize certain Amgen treatments in China and will split those earnings or losses.

BeiGene is going to take three different Amgen products to market: Xgeva, a prescription bone treatment; Kyprolis, a treatment for myeloma; and Blincyto, a leukemia treatment. BeiGene will ultimately be able retain the rights to one those treatments and earn royalties on the others for an additional five years after the commercialization period, Amgen said.

Amgen said Xgeva was introduced in China last month and the other two treatments are in Phase III trials.

BeiGene is also going to work with Amgen on 20 of Amgen's oncology medicines. Amgen said that BeiGene will contribute as much as $1.25 billion for developing those treatments. It will also help cover expenses for research and development, Amgen said.

Amgen expects the deal to close early next year.

China has increasingly been approving foreign drugs, following a series of policy moves by China to provide its mammoth population to new treatments, particularly those that treat cancer.

Merck & Co. earlier this week reported that sales grew by 90% in China during the third-quarter. AstraZeneca Chief Executive Pascal Soriot said last year that he expected China to eventually overtake Europe as the company's second-largest market. The merger of Pfizer Inc.'s off-patent drug business, Upjohn, with Mylan NV offered Mylan expanded geographic reach in China where Upjohn has a strong presence.

Write to Allison Prang at allison.prang@wsj.com and Jared S. Hopkins at jared.hopkins@wsj.com

(END) Dow Jones Newswires

October 31, 2019 17:55 ET (21:55 GMT)

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