[Edaily Reporter NA EUN-KYUNG ] HanmiPharm(128940)The company is set to regain the overseas rights to “Belvarapenib,” an anti-cancer candidate compound it licensed to U.S.-based Genentech 10 years ago. Although Genentech officially announced the suspension of Belvarapenib’s development in April 2024, the contract will not actually terminate until this coming December. It took approximately 2 years and 8 months just to reclaim the overseas rights to a candidate compound whose development had been halted.

The period between the suspension of development and the return of rights requires time to determine whether to proceed with further development. The issue is who controls that time and how. For this reason, industry experts point out that, in technology licensing agreements, it is just as important to include contractual provisions allowing the original developer to reclaim rights at a specific point in time if the partner halts development as it is to secure upfront payments and milestone payments.

HanmiPharm announced on the 29th that it had received notice from Genentech regarding the termination of the technology transfer agreement for Belbarapenib and the return of rights. The termination will take effect on December 27, 90 days after the date of notification. The two companies plan to cooperate to ensure a smooth transfer of responsibilities and authority related to Belbarapenib by that date.

Belvarafenib is a targeted anticancer drug that HanmiPharm licensed to Genentech in September 2016; at that time, it transferred global development and commercialization rights (excluding South Korea) for up to $910 million (approximately 1 trillion won at the time of the agreement). Of this amount, the non-refundable upfront payment was $80 million (approximately 93.8 billion won at the time of receipt), which HanmiPharm received in December of the same year.

Two years and eight months between development suspension and the return of rights

Belvarapenib is an oral targeted anticancer drug that inhibits RAF in the mitogen-activated protein kinase (MAPK) pathway, which is involved in the growth and proliferation of tumor cells. Following the technology transfer, Genentech proceeded with the development of belvarapenib for various solid tumors, but in April 2024, it halted further patient enrollment and removed the drug from Roche’s development pipeline.

At the time, the Roche Group, including Genentech, was reorganizing its oncology research and development (R&D) portfolio. In August 2024, approximately four months after removing velbarapenib from its pipeline, Genentech dissolved its independently operated Cancer Immunology division and integrated its functions into the Molecular Oncology division.

However, the suspension of belvarapenib’s development did not lead to the termination of the contract. HanmiPharm stated at the time, “This does not imply contract termination or the return of the compound,” and announced that it would continue to consult with Genentech on the future direction of clinical development.

Subsequently, the two companies discussed the future development path for belvarapenib, but Genentech did not resume development; approximately two years and five months later, Hanmi Pharmaceutical was notified of the contract termination and the return of rights. The actual termination of the contract and return of rights will take place on December 27, following a 90-day notice period.

HanmiPharm maintains that this return of rights was not a sudden decision. A HanmiPharm official explained, “This announcement is the contractual termination procedure for a matter that Genentech had already formalized several years ago—namely, its decision to cease development—and was a foreseeable outcome.” The spokesperson added, “Hanmi is currently conducting a Phase 2 clinical trial in Korea to develop belvarapenib as an oral anticancer drug for the treatment of melanoma,” noting that “in the new drug development sector, the return of rights is not an end but an opportunity to create new innovations.” Unlike the explanation provided in 2024, which left open the possibility of resuming development, this statement effectively frames the previous suspension of development as the starting point for the current contract termination.

In fact, HanmiPharm’s explanation draws attention to the two-year-and-eight-month time lag between the suspension of development and the actual return of rights. This is because, if the return of rights is both a foreseeable contractual termination procedure and a new opportunity for follow-up development, the speed at which overseas rights can be recovered from a partner that has suspended development is also crucial.

How Did Other Agreements Fare… Eyes on Rights Recovery Mechanisms

There are also cases in Genentech’s other technology licensing agreements where a time lag occurred between the suspension of development and the termination of the contract. A prime example is “Fvalopendekine Alpha” from the U.S. biotech company Xencor. Roche removed this candidate from its development pipeline in January 2025. However, Genentech did not officially notify Xencor of the contract termination until March 4, 2026, and following a six-month notice period, the contract was terminated on September 4 of the same year. It took approximately one year and eight months from the time the candidate was removed from the pipeline to the termination of the contract.

Therefore, simply because Genentech removed a candidate from its pipeline does not mean the corresponding license agreement terminates immediately. However, even compared to the Zenco case, it took about one additional year for the rights to Velbarapenib to be formally returned.

In the new drug development industry, one year is enough time for market trends to shift. Global pharmaceutical companies’ interest shifts rapidly depending on clinical results for specific targets or treatment modalities, and demand for technology transfers and investments changes accordingly. In the field of anticancer drugs in particular, the competitive landscape can change significantly even within one to two years. Even in the field of melanoma, where Belvaraphenib is being developed, candidate compounds that target cancer cells in new ways are emerging one after another. This means that even if the value of the candidate compound itself remains unchanged while the return of rights is delayed, the interest of global pharmaceutical companies and the demand for technology transfer may change.

In other technology licensing agreements with Genentech, the termination date is specified more clearly. On July 11, 2024, the U.S. biotech company Relay Therapeutics received notice from Genentech of the termination of the agreement for the SHP2 inhibitor “migoprotapib.” In accordance with the agreement, the termination took effect on January 7, 2025—180 days after the notice was issued—and as of that date, both companies’ development and commercialization obligations, as well as the license granted to Genentech, were terminated.

In technology licensing agreements, it is crucial to specify in detail the “development diligence” requirements—which ensure the partner devotes a certain level of effort to developing the candidate compound—as well as the criteria for halting development, the original developer’s right to terminate the agreement, the notice period for termination, and the procedures for reversion of rights. These are mechanisms designed to enable the original developer to swiftly reclaim the assets should the partner abandon development.

Since the development stages, division of roles, and termination conditions vary from contract to contract, it is difficult to make a simple comparison of the time taken for reversion. However, in the case of belvarapenib, it has not been disclosed how long Genentech was given to decide whether to proceed with follow-up development after halting development, nor whether there were provisions allowing HanmiPharm to terminate the contract or reclaim overseas rights if development did not proceed for a certain period.

The Belvarapenib case remains noteworthy given that HanmiPharm and Genentech recently signed a new technology licensing agreement. Last August, HanmiPharm licensed “HM17321,” a candidate drug for the treatment of obesity and metabolic disorders, to Genentech in a deal worth up to $2.3 billion (approximately 3.12 trillion won). Once again, Genentech secured exclusive rights to the development, manufacturing, and commercialization of HM17321 worldwide, excluding South Korea. HanmiPharm will conduct Phase 1 clinical trials, after which Genentech will take over development starting with Phase 2.

Although Belvarapenib and HM17321 are at different stages of development, they share the commonality that control over overseas development has been handed over to Genentech. However, since the specific terms of the HM17321 agreement have not been disclosed, it is difficult to determine how the termination and rights reversion procedures in the event of development cessation differ from those in the Belvarapenib agreement.

A lawyer who advises on technology transfer transactions in the pharmaceutical and biotech sectors noted, “Domestic pharmaceutical and biotech companies often overlook the importance of structuring technology transfer agreements to ensure they can quickly reclaim rights if a partner halts development.” He added, “However, in the field of new drug development, interest and investment trends regarding specific targets or treatment modalities change rapidly. If a global pharmaceutical company retains rights for an extended period after halting development, by the time the original developer regains those rights, the technology may have already fallen out of the market’s spotlight, causing the company to miss the window of opportunity to find a new partner,” he pointed out.