Sorrento buys into biosimilars with a Chinese antibody deal

Sorrento CEO Henry Ji

Sorrento Therapeutics ($SRNE), among many companies in the orbit of billionaire entrepreneur Patrick Soon-Shiong, is looking to take a spot in the growing market for knockoffs of the world's top-selling biotech medicines.

Under a deal with China's Mabtech Limited, the San Diego-headquartered Sorrento is acquiring the North American, European and Japanese rights to four late-stage biosimilars, copycat versions of blockbusters soon to lose patent protection around the world. Sorrento is disclosing neither how much it's paying in the agreement nor the biosimilars' reference products, saying only that their combined 2014 revenue topped $13 billion last year.

Each of the antibodies has completed a Phase III study in China, the company said, and it'll be on Sorrento to take them through the regulatory process in each of its home territories.

The agreement further expands Sorrento's R&D strategy, which to this point focused on immunotherapies for cancer. The company, an antibody specialist, raised its profile in December when Soon-Shiong enlisted Sorrento to launch an immuno-oncology joint venture, at the same time buying a 20% stake in his new partner. And thus began a whirlwind of deals, licensings and spinoffs that has seen Sorrento swap assets with Soon-Shiong-affiliated entities, shipping R&D programs in and out and watching as its share price more than tripled.

The pair's latest gambit, an as-yet-unnamed venture looking at cancer targets widely considered undruggable, got off the ground last month with a $100 million commitment from its founders. Before that, Sorrento launched a subsidiary called TNK Therapeutics alongside Soon-Shiong's Conkwest, an immunotherapy outfit since rechristened NantKwest ($NK) on the way to a record-setting IPO last month.

Sorrento's biosimilars deal stands out among transactions in Soon-Shiong's constellation, which are usually limited to agreements between compatriot companies. And Sorrento sees the move as a means of further differentiating itself among the world's drug developers.

"We look at this collaboration as a transformational event for Sorrento and are excited about its potential to complement our expanding and deep internal biologics portfolio," CEO Henry Ji said in a statement. "With this exclusive license agreement, Sorrento takes a significant step toward becoming a major player in the biopharmaceutical industry."

- read the statement