What are the main components of the agreement between Amgen and BeiGene?

The agreement consists of two primary parts: a Collaboration Agreement for commercializing specific Amgen oncology products in China and co-developing pipeline assets globally, and a Share Purchase Agreement where Amgen invests significantly in BeiGene.

Which Amgen oncology products are involved in the China collaboration?

The collaboration for China involves Amgen's oncology products XGEVA® (denosumab), KYPROLIS® (carfilzomib), and BLINCYTO® (blinatumomab).

What are the terms for revenue and profit sharing in the collaboration?

For the commercialized products in China, Amgen and BeiGene Switzerland will share profits and losses equally. For the pipeline products, after regulatory approval in China, they will also share profits and losses equally for a seven-year commercialization period, with options for BeiGene to retain certain products.

When is this transaction expected to be completed?

The closing of the transaction is expected in the first quarter of 2020, contingent upon BeiGene shareholder approval, expiration of antitrust waiting periods, and other standard closing conditions.

AMGN 8-K: Material Agreements & Regulation FD

Q: What is Amgen's financial commitment and what stake does it gain in BeiGene?

Amgen is purchasing approximately $2.734 billion of BeiGene's ordinary shares in a private placement, which is expected to result in Amgen holding approximately 20.5% of BeiGene's outstanding shares. Additionally, BeiGene Switzerland is committing up to $1.25 billion towards the development costs of Amgen's pipeline oncology products.

Summary

Amgen Inc. announced a significant strategic collaboration and investment with BeiGene, Ltd., focusing on expanding its oncology portfolio in China and globally. The core of the agreement involves a collaboration with BeiGene Switzerland GmbH for the commercialization of Amgen's key oncology products XGEVA®, KYPROLIS®, and BLINCYTO® in China. This partnership also extends to the global development and commercialization of 20 Amgen pipeline oncology products, with BeiGene Switzerland committing up to $1.25 billion towards development cost sharing. In conjunction with the collaboration, Amgen is making a substantial strategic investment by purchasing approximately $2.734 billion of BeiGene's ordinary shares in a private placement. This acquisition is set to result in Amgen holding approximately 20.5% of BeiGene's outstanding shares, granting Amgen board representation and aligning the companies for future growth. The transaction is expected to close in the first quarter of 2020, subject to customary closing conditions including BeiGene shareholder approval and regulatory clearances.

Key Highlights

1Amgen enters a strategic collaboration with BeiGene Switzerland GmbH to commercialize XGEVA®, KYPROLIS®, and BLINCYTO® in China and co-develop 20 Amgen oncology pipeline products globally.
2BeiGene Switzerland to contribute up to $1.25 billion towards global development costs for Amgen's pipeline oncology assets.
3Amgen invests approximately $2.734 billion to acquire roughly 20.5% of BeiGene's outstanding shares via a private placement.
4The investment implies a 36% premium to BeiGene's 30-day average share price as of October 30, 2019.
5Amgen gains the right to designate a director to BeiGene's board of directors.
6The collaboration and investment are structured for profit and loss sharing in the Chinese market for the specified products and pipeline assets.
7The transaction is anticipated to close in Q1 2020, pending shareholder approval, antitrust clearances, and other customary conditions.

AMGEN INC 8-K Report, Material Agreement (Oct 31, 2019)

Summary

Key Highlights

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