$15.2 billion! Hengrui Medicine and Bristol-Myers Squibb reach a strategic cooperation agreement, stock price soars

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Hengrui Pharma has reached one of its largest outbound licensing deals to date with global pharmaceutical giant Bristol Myers Squibb (BMS), with a potential total transaction value of up to approximately $15.2 billion, covering joint development of 13 early-stage innovative drugs. The news boosted the company’s share price significantly.

According to announcements from both parties on May 12, BMS will pay Hengrui up to $950 million in near-term payments, including a $600 million upfront payment and two annual payments totaling $350 million.If all projects are successfully developed, registered, and commercialized, the potential total transaction value could reach around $15.2 billion. The transaction is expected to close in the third quarter of 2026.

After the news was released, Hengrui Pharma’s shares in Hong Kong rose more than 14% at one point, while its A-shares jumped nearly 6%. The market reacted positively to this milestone cooperation.

Cooperation Framework: 13 Projects, Clear Division of Rights

According to the agreement, the collaboration covers three categories: four original Hengrui oncology and hematology projects, four original BMS immunology projects, and five innovative projects jointly developed leveraging Hengrui’s R&D platform and BMS. In total, there are 13 early-stage innovative drugs.

Regarding rights allocation, BMS receives exclusive global rights (outside Mainland China, Hong Kong, and Macau) to Hengrui-originated projects and jointly developed projects. Hengrui receives exclusive rights to BMS-originated projects in Mainland China, Hong Kong, and Macau, while BMS retains rights in other global markets. Hengrui will be fully responsible for early-stage clinical development of the above projects, with options for joint development of certain projects and opportunities to jointly commercialize projects globally with BMS. Additionally, Hengrui is entitled to tiered sales royalties based on net sales (excluding Mainland China, Hong Kong, and Macau).

Statements from Both Sides: Complementary Advantages, Accelerating Early Innovation

Jiang Ningjun, Executive Vice President and Chief Strategy Officer of Hengrui Pharma, commented that this collaboration "fully demonstrates the deep synergy between two global innovation leaders with complementary strengths," emphasizing that Hengrui will rely on its continually upgraded innovation R&D capability and efficiency advantages to comprehensively advance quality assets in both companies' pipelines, reflecting Hengrui’s strategic determination to deepen its global layout.

Robert Plenge, Executive Vice President and Chief Research Officer of BMS, stated that this partnership not only shows BMS's commitment to driving scientific innovation but also its prudent approach to portfolio management. He said both sides will leverage their respective regional synergy advantages to accelerate early-stage clinical exploration, “helping drive outstanding progress in the coming decade.”

Deal Structure: $600 Million Upfront Payment, Significant Milestone Potential

In terms of financial terms, BMS will pay Hengrui three installments: a $600 million upfront payment, a $175 million first annual payment, and a $175 million conditional 2028 annual payment, totaling up to $950 million.

The potential total transaction value of approximately $15.2 billion includes options for co-development project selection, and milestone payments for all 13 projects through development, registration, and commercialization stages. The deal is subject to approval from regulators under the U.S. Hart-Scott-Rodino Antitrust Improvements Act and the satisfaction of other customary closing conditions.

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