ZURICH (Reuters) - Novartis (S:NOVN) has enlisted Chinese manufacturer Cellular Biomedicine (CBMG) (O:CBMG) to make its $475,000 (362,663 pounds) gene-modifying cancer treatment Kymriah as the Swiss drugmaker intends to win approval for the therapy in the world's most populous country.
Local regulations require that Novartis manufactures Kymriah in China if it wants to treat the country's patients with the drug.
The Chinese company's shares rose more than 16 percent in pre-market trading after the deal was announced on Thursday. Novartis shares closed 0.9 percent higher.
Basel-based Novartis is paying $40 million to buy 9 percent of CBMG's shares, the Chinese company said. Novartis also gets rights to develop and sell products using CBMG technology in the deal.
The deal fits Novartis' push to expand its global manufacturing footprint for Kymriah, a one-time, personalised CAR-T therapy in which doctors remove disease fighting T-cells from individual patients to be modified to attack cancer before being re-infused into patients.
Novartis recently announced production pacts in France, Germany and Switzerland, where it is building its own Kymriah factory. Novartis would lead distribution, commercialisation and approval efforts within China, it said, but declined to give the status of Kymriah's progress with Chinese drug regulators.
"For proprietary reasons, we cannot disclose our strategy in China," a spokeswoman said in an e-mail. "However, our collaboration with CBMG is a step towards our efforts to bring Kymriah to patients in China."
The treatment, aimed at patients who have failed to respond to other drugs, has already been approved in Europe and the United States to treat gravely ill children with acute lymphoblastic leukemia (ALL), as well as adults with diffuse large B-cell lymphoma (DLBCL).
Novartis is initially rolling out the treatment in Europe just for young patients with ALL, after encountering problems with the quality of batches for DLBCL patients. The company has said the treatment for DLBCL patients requires additional work to meet commercial specifications.
A similar CAR-T therapy, Gilead Sciences’ (O:GILD) Yescarta, has also been approved for DLBCL patients in the United States and Europe. Last year, Yescarta's maker began manufacturing Yescarta in China, part of its bid for eventual approval there.