“Not only is our collaboration with Boehringer Ingelheim on this molecule Yuhan’s first external partnership with biologics, it is also the very first out-licensing of biologics targeting NASH from Korea,” Lee said.

Yuhan has been a longtime commercial partner for Boehringer Ingelheim’s diabetes products in Korea.

Under the terms of the new agreement, Yuhan will receive upfront and near-term payments of $40 million and is eligible to receive up to $830 million in potential milestone payments plus tiered royalties on future net sales.

Genexine, in turn, receives 5 percent of the out-licensing deal in royalties. In 2013, the biotech firm licensed out its hyFc technology to Yuhan and added four more target proteins to the portfolio with Yuhan. The new deal marks the first of the five proteins to yield profits for Yuhan.

Through this agreement, Boehringer Ingelheim said it has expanded its pipeline to include that of next-generation NASH treatments that target all three key drivers of the disease, namely steatosis, inflammation and fibrosis.

Shares of Yuhan hit an intraday high of 267,500 won and closed trading at 251,500 won ($216.30) on Monday, up 2.86 percent from the day before, while Genexine shares ended at 62,500 won, up 10.23 percent.

The collaboration brings together Yuhan’s expertise in FGF21 biology, obesity and NASH with Boehringer Ingelheim’s pharmaceutical expertise and commitment to bringing innovative medicines to patients with cardiometabolic diseases, the companies said.

By Lim Jeong-yeo (kaylalim@heraldcorp.com)