08.30.11

XBiotech Launches Partnership Talks in Asia

XBiotech believes its lead product candidate offers unprecedented market opportunity for a biological drug in Asia. The Company has thus begun talks with possible partners to explore the level of interest among pharmaceutical companies in that region. XBiotech’s CEO, Mr. John Simard, stated “We have chosen to launch discussions with what we believe is a strong player in the region, an organization that has, among other strengths, the right operational capabilities to support the tremendous growth potential for our therapeutic in Asia. We are looking for a uniquely capable pharmaceutical company, with the ability to manufacture biological drugs based on our platform and to market these products in established and emerging markets in the region. We are, therefore, seeking a partner that shares with us a common vision for our True Human™ therapy targeting chronic inflammation.” Management at XBiotech stresses that these discussions are preliminary and that much work is to be done to find a suitable deal structure for its lead product candidate. Mr. Simard added, “This is a very, very special opportunity that we are discussing with respect to our lead product. I believe that a product like this presents itself perhaps only once in a generation, so we are proceeding slowly as we continue to understand the dynamics of the deal opportunity in the region.”

The pharma market is experiencing rapid growth in the Asia-Pacific region. Increased R&D activities in the region and the rise of generics has helped the region grow to an estimated market size of around US$ 187 Billion in 2009. It has been reported that the pharmaceutical industry is expected to grow at a compound annual growth rate of around 12.6% during 2010-2012.

Sales growth is driven in part by market expansion in China, India and Indonesia. Growth in this region reflects rising disposable income, emerging health insurance programs, and growing activity among pharma companies in the region. It is predicted that China’s pharmaceutical market will grow at over 20% annually over the coming years. India is now understood to be the 3rd largest manufacturer of drugs in the world.

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