On June 24 Huahai Pharmaceuticals announced that, its subsidiary Shanghai Huaota Biopharmaceutical Co., Ltd. (aka ‘Huaota’) signed the ‘Drug Technology Transfer and Cooperative Development Contract’ with Junshi Biosciences. The contract agreed on the follow-up R&D, production, marketing and sales cooperation between Huaota and Junshi Biosciences on the Avastin monoclonal antibody biosimilar (HOT-1010), and the joint application of HOT-1010 and Teriplimumab injection from Junshi Biosciences.

The content is as follows:

1. Huaota transfers the full set of application materials regarding HOT-1010's production technology, R&D results and IND approval to Junshi Biosciences. Huaota will technically guide Junshi Biosciences to produce Phase III clinical trial drugs that are consistent with the Phase I clinical trial drugs, as well as to meet the requirements of stability tests.

Huaota is responsible for phase I clinical trials, the phase III clinical trials and its procurement of raw materials required for phase III clinical trials. Junshi Biosciences is responsible to produce phase III clinical trial drugs in workshops comply with GMP. the registration application of the drug, as well as the production and marketing of the drug after the registration is obtained. After HOT-1010 is successfully listed, all intellectual property rights related to the drug production technology will be shared by both parties.

2. After HOT-1010 is successfully listed, both parties will be jointly responsible for completing the Investigational new drug (IND) application for the combined therapy of HOT-1010/Treplimumab, and the two parties will bild a team to complete the clinical trial required for the registration and application of HOT-1010/Treplimumab combined medication (phase I, II, III). Junshi Biosciences will be responsible for the joint application development costs, subsequent commercial production and marketing and other costs.

3. After HOT-1010 is successfully listed, all operating profits generated by the drug will be distributed at a 50:50 ration between each party.

4. Operating profit generated by the combined medication of HOT-1010/Treprizumab: 1) All (100%) operating profit of the portion of Teriprizumab will be enjoyed by Junshi Biosciences. 2) The part of HOT-1010, included in the operating profit generated by the drug, will be distributed evenly between each party.

Huaota’s transfer of HOT-1010's existing research and development results, as well as it’s subsequent technical support will receive a three-phase payment of ￥90 million from Junshi Biosciences.