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China Fund News reporter Niu Siruo

On July 22, Wantai Biological, the leading HPV vaccine company under Zhong Shanshan, issued an announcement that its wholly-owned subsidiary Wantai Canghai and GlaxoSmithKline have decided to terminate the development and commercialization cooperation of the new generation of cervical cancer vaccine.

According to the announcement, Wantai Canghai and GlaxoSmithKline started cooperation in 2019. However, after friendly negotiations, the two parties decided not to continue the development and commercialization cooperation under the agreement.

It is worth noting that the clinical application work for the nine-valent HPV vaccine jointly developed by Wantai Canghai and Xiamen University is still proceeding in an orderly manner, and the domestically produced nine-valent HPV vaccine is expected to be launched on the market.

Received 174 million yuan in milestone payments

On July 22, Wantai Biological announced that its wholly-owned subsidiary Wantai Canghai and GlaxoSmithKline signed a letter of termination of the cooperation agreement, deciding not to continue the development and commercialization cooperation of the new generation of cervical cancer vaccine (hereinafter referred to as "HPV9-AS04 candidate vaccine").

It is reported that this cooperation started four years ago. In 2019, the two parties agreed to jointly develop a new generation of cervical cancer vaccine based on Wantai Canghai's E. coli prokaryotic expression vaccine antigen technology and GlaxoSmithKline's adjuvant technology. The antigen will be produced by Wantai Canghai in China, and GlaxoSmithKline will be responsible for the development and production of vaccine adjuvants and finished vaccines overseas. The two parties will carry out commercial development in the areas agreed upon in the "Cooperation Agreement".

Regarding the termination of this cooperation, Wantai Bio said that both parties will cooperate sincerely and properly handle the termination within 100 days in accordance with the provisions of the Cooperation Agreement. Despite the termination of the cooperation, Wantai Canghai will still assist GlaxoSmithKline in completing the clinical trials, pharmacovigilance and quality work related to the termination of the agreement.

Through this cooperation, Wantai Canghai received two milestone payments from GlaxoSmithKline in 2019 and 2021, totaling 22 million euros (approximately 174 million yuan).

In this regard, Wantai Bio emphasized that the subsequent work after the termination of the "Cooperation Agreement" will not incur significant expenses or significant asset impairment. The 22 million euros will not be refunded due to the termination of the "Cooperation Agreement". The termination of the "Cooperation Agreement" will not affect Wantai Canghai's recognized revenue and will not have a significant adverse impact on the company's finances.

In addition, given that the development of the HPV9-AS04 candidate vaccine will no longer continue, after the termination of the "Cooperation Agreement", Wantai Canghai will no longer have the exclusive agency rights for the HPV9-AS04 candidate vaccine in China and some other countries/regions.

Domestic nine-valent HPV vaccine is on the way

At present, Wantai Biological is actively planning the domestic nine-valent HPV vaccine. The clinical application work for the nine-valent HPV vaccine developed in cooperation with Xiamen University is still proceeding in an orderly manner. The nine-valent HPV vaccine and the HPV9-AS04 candidate vaccine in the "Cooperation Agreement" are two completely different vaccine products.

After the termination of the Cooperation Agreement, Wantai Canghai will no longer be subject to the restrictions of the Cooperation Agreement, and the nine-valent HPV vaccine jointly developed by Wantai Canghai and Xiamen University will be able to obtain complete commercialization rights worldwide.

On April 10 this year, Wantai Biological announced that the nine-valent HPV vaccine it developed had completed the unblinding of the main data of the Phase III clinical trial, the preliminary analysis results were in line with expectations, and it began to write the registration and listing application materials.

In addition to Wantai Biological, the nine-valent HPV vaccines of four domestic companies, namely Watson Bio, Kanglewei, Ruike Bio, and Bowei Bio, are all in the phase III clinical trial stage. Currently, the only nine-valent HPV vaccine approved for sale in China is Merck's nine-valent human papillomavirus vaccine (brewer's yeast). If Wantai Biological's nine-valent HPV vaccine is approved, it will take the first place in the listing of domestic nine-valent HPV vaccines.

Guojin Securities Research Report estimates that the potential stock market of HPV vaccines in China is 194.8 billion yuan. Industry insiders analyzed that it is expected that in 2025, domestically produced nine-valent HPV vaccines will be launched on the market one after another, and the resulting market competition will further intensify, and there are still many uncertainties in the market structure.

Editor: Joey

Reviewer: Chen Siyang

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