Dong-A ST said it has signed a global license agreement with NeuroBo Pharmaceuticals, an American pharmaceutical company.
Under the agreement, Dong-A ST plans to accelerate the development and global commercialization of DA-1241, a treatment for type 2 diabetes and non-alcoholic steatohepatitis (NASH), and DA-1726, a treatment for obesity and NASH, as NeuroBo has a geographic advantage of being located in Boston and has access to easy funding as a NASDAQ-listed company.
Dong-A ST will transfer exclusive worldwide development and sales rights for DA-1241 and DA-1726, excluding Korea, to NeuroBo.
The Korean company will receive an upfront payment of $22 million, milestones for each stage and royalties based on sales, and will be responsible for the production of clinical samples and post-marketing products.
NeuroBo will be responsible for the worldwide clinical development, licensing and sales of DA-1241 and DA-1726.
Notably, Dong-A ST plans to use the initial payment of $22 million to acquire convertible preferred shares of NeuroBo and plans to acquire additional shares by investing $15 million in NeuroBo.
After completion, Dong-A ST will become NeuroBo’s largest shareholder with a 50.8% stake in the company.
However, for this contract to be finalized, NeuroBo will have to raise a total of $30 million, including $15 million invested by Dong-A ST.
NeuroBo plans to raise funds through a general public offering in October.
“The signing of this contract will unite the R&D capabilities of both companies to accelerate the development of excellent therapies,” said Dong-A ST CEO Kim Min-young. “We will continue to strengthen our R&D capabilities and do our best to become a global pharmaceutical company through collaboration with global companies.”
NeuroBo CEO Gil Price said, “In securing Dong-A ST’s excellent pipeline, it is very significant that we have entered the areas of NASH, obesity and diabetes, which are highly marketable.
NeuroBo will successfully complete funding and begin clinical studies and research on DA-1241 and DA-1726 as soon as possible, Price added.
The recent agreement comes after a long-standing partnership between Dong-A ST and NeuroBo Pharmaceuticals.
The two companies first entered into a technology transfer agreement in 2018, when Dong-A ST licensed DA-9801, a natural extract-based diabetic neuropathy treatment, to NeuroBo.
Meanwhile, Dong-A ST received $2 million and a 5% stake in NeuroBo.
In March 2021, Dong-A ST said it had signed a contract with E& Investment, a Korean venture capitalist with a 33% stake in NeuroBo Pharmaceuticals, to receive the latter’s voting rights for the American company.
