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Shares of Dizal Pharmaceutical soared to their maximum daily trading limit following the announcement that the Chinese pharmaceutical company granted AstraZeneca exclusive global rights to its pioneering lung cancer treatment, a deal valued at up to $1.5 billion.
The company’s stock jumped 20 percent, closing at CNY 56.33 (approximately $8.31) per share. Meanwhile, Shanghai’s tech-focused Star Market Composite Index increased by 0.8 percent.
According to the agreement, AstraZeneca will make an upfront payment of $600 million for the worldwide rights to develop and commercialize Zegfrovy, an innovative drug targeting non-small cell lung cancer. The UK-Swedish firm will also pay milestone payments totaling up to $400 million—linked to development achievements—and up to $500 million based on sales performance.
In addition, Dizal Pharma is eligible for tiered royalties on annual net sales, which could reach low double-digit percentages.
The deal resulted from negotiations that evaluated Zegfrovy’s current development status, market potential, AstraZeneca’s global capabilities in development and commercialization, and comparable licensing agreements for similar innovative cancer treatments.
Completion of the transaction is expected in the latter half of this year, pending typical closing conditions and regulatory approvals from foreign authorities and competition regulators.
Zegfrovy is an oral, irreversible, highly selective epidermal growth factor receptor (EGFR) tyrosine kinase inhibitor designed to target multiple EGFR mutant subtypes. It has already received approval in China and the United States for treating locally advanced or metastatic non-small cell lung cancer patients with EGFR exon 20 insertion mutations who have progressed on or are intolerant to platinum-based chemotherapy.
The company has submitted applications to Chinese and U.S. regulators for Zegfrovy’s use as a first-line treatment for this specific non-small cell lung cancer subtype. Both China’s Center for Drug Evaluation and the U.S. Food and Drug Administration have granted Breakthrough Therapy Designation for this indication.
This partnership is poised to accelerate the global development and commercialization efforts for Zegfrovy, improve Dizal Pharma’s cash flow, speed up the recovery of initial R&D investments, provide ongoing financial support for future pipeline assets, and promote sustainable long-term growth.
Founded in 2017 as a joint venture between AstraZeneca and China Investment Corporation’s unit China National Investment Innovation Capital Management, Dizal Pharma went public in December 2021. AstraZeneca’s affiliate and a China-based investment fund each hold a 23.4 percent stake, making them the company’s largest shareholders. The recent agreement involves related-party transactions.
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