Shareholders approve China Medical Systems investment in Midatech
Midatech Pharma Plc
$0.92
13:09 10/05/24
Midatech Pharma confirmed on Tuesday that, following shareholder approval of the strategic investment by China Medical Systems (CMS) and A&B Hong Kong, the licence agreement entered into between itself and CMS was now formally in force.
The AIM-traded firm said the strategic investment by CMS and A&B comprised an £8m subscription in Midatech, for a total of 207,792,206 ordinary shares at a price of 3.85p per share.
It said the subscription shares were admitted to trading on AIM on Tuesday morning, alongside the placing shares and open offer shares.
Midatech said that from its product perspective, as stipulated in the licence agreement, CMS had rights to develop and commercialise its pipeline of products - including any products which were in or entered into preclinical or clinical development within a period of three years - in Greater China and certain South East Asian countries excluding Japan and South Korea in perpetuity.
Subject to certain milestones being achieved, Midatech said it would be entitled to receive regulatory and sales-based milestone payments as well as royalty payments.
From a Midatech technology platform perspective, the board said the licence agreement permitted CMS to identify its own potential product opportunities and, if agreed by Midatech, it would be entitled to carry out such development in China with initial assistance from Midatech, which would be funded by CMS through a technology transfer fee.
If such products obtained approval, CMS would retain the rights specific to such developed products, and will license the company to commercialise them outside the CMS territory in the rest of the world.
The board said the collaboration provided Midatech with a “key strategic partnership” in China and Southeast Asia, access to the “significant” Chinese market, substantial investment and funds for Midatech's current key programs, as well as additional CMS funded opportunities for the company's technology platforms ‘Q-Sphera’, ‘MidaSolve’, and ‘MidaCore’.
“We are delighted to finalise the licence agreement with China Medical Systems, a leading Hong Kong based Chinese pharmaceutical company,” said Midatech chief executive officer Dr Craig Cook.
“This is a key collaboration for Midatech that provides a strong endorsement of our technologies and pipeline whilst establishing a solid foundation for a successful and ambitious long-term partnership.
“The agreement will enable development of current and new products and extend our reach to the important markets of China and Southeast Asia.”