Oncimmune forms China distribution partnership

Oncimmune Holdings has signed a framework distribution agreement for an exclusive licence with Genostics Company, a Hong Kong registered group that is part of China-based Gene Group.

The agreement covers the distribution, manufacturing and future development of all products related to Oncimmune's EarlyCDT platform in China, with an initial focus on treating lung cancer.

Under the agreement, Genostics would start to sell EarlyCDT-Lung within 36 months of the date of the agreement, subject to China FDA approval, though both parties expect this to be sooner.

Oncimmune would receive a royalty of around 8% on the gross revenue subject to minimum royalty payments over the first six years post market entry of £15.7m on aggregate and £5m per year thereafter.

Genostics has also agreed, subject to shareholder approval, to invest £10m in Oncimmune by way of subscription for 6,410,256 new ordinary shares at a price of 156p per share. The price represents a 49% premium to the share price of 105p at market close on December 29.

"Oncimmune continues to deliver on our stated strategy at the time of the IPO; a key part of this was a commercial agreement for China," chief executive Geoffrey Hamilton-Fairley said.

"We look forward to working with Genostics and believe the funds from the equity subscription of this deal will unlock further opportunities across indications as well allowing us to develop new technologies."

At 9:26am: (LON:ONC) Oncimmune Holdings Plc share price was +14p at 119p