US-based ABVC Biopharma Inc. has entered into a legally binding term sheet with China-based Xinnovation Therapeutics Co., Ltd., handing over exclusive rights to two of its central nervous system (CNS) disease drugs in the Chinese market. Under the agreement, Xinnovation will receive exclusive development, manufacturing, marketing, and distribution rights for ABV-1504, intended for major depressive disorder (MDD), and ABV-1505, for attention-deficit/hyperactivity disorder (ADHD) in mainland China.
Financial Terms and Potential Milestones
The deal is structured to provide ABVC with an aggregate income of USD 20 million if all milestones are achieved. A finalized agreement, including full terms and conditions, is yet to be signed by both firms. Additionally, ABVC stands to receive royalty payments ranging from 5% to 12% on any future net sales of the products in China.
Botanical Drugs and Traditional Chinese Medicine
ABV-1504 and ABV-1505 are botanical drugs derived from the extract of the Polygala tenuifolia (Yuanzhi) root, which is commonly used in traditional Chinese medicine (TCM). Xinnovation will take on the responsibility of growing the root and conducting manufacturing processes in China, leveraging its local expertise and resources.-Fineline Info & Tech
