A year after Leclaza securing European approval…Yuhan

Leclaza, the milestone has not been paid following the European approval in December 2024

The technology fee was transferred after sales began in major European countries…Sales began this year in the UK and Germany

Yuhan expects to receive a $30 million technology fee payment for the European market entry of its new anticancer drug, Leclaza, soon.

During the recent Q1 business performance presentation, Yuhan stated, “We expect to receive the $30 million milestone associated with the European launch of the lazertinib combination therapy soon,” and added, “The business plan established early this year is progressing smoothly.”

Lazertinib, the active pharmaceutical ingredient of Leclaza, is a new anticancer drug developed by Yuhan. Leclaza is a non-small cell lung cancer (NSCLC) treatment that was approved in January 2021 as the 31st domestically developed new drug in Korea.

In December 2024, the European Commission (EC) approved the combination therapy of Leclaza + Rybrevant as a first-line treatment for adult patients with locally advanced or metastatic NSCLC harboring epidermal growth factor receptor (EGFR) exon 19 deletions or exon 21 L858R substitution mutations.

While the $30 million (approx. KRW 44 billion) milestone was met with Leclaza's entry into the European market, the payment has not yet been received, despite 17 months having passed. According to the company, the milestone will be transferred once sales of Leclaza begin in major European countries. Since the beginning of this year, Leclaza has been listed for health insurance in countries such as the UK, Switzerland, Italy, and Germany, and sales have begun. Securities analysts anticipate the European technology fee will be received within the first half of the year.

Yuhan recorded KRW 5 billion in technology fee revenue in the first quarter. This is a 23.7% increase from the KRW 4 billion recorded in Q1 of last year, but significantly lower than the KRW 70.3 billion recorded in the previous quarter. Technology fee revenue inherently fluctuates, as it is generated from new drug licensing agreements or the advancement of development stages for licensed-out drugs.

Last year, Yuhan received KRW 104.1 billion in technology fee revenue, with milestones from approvals in Japan and China accounting for a large portion.

In May of last year, as the Japanese Ministry of Health, Labor and Welfare approved the Leclaza + amivantamab combination therapy, the requirement for an additional $15 million milestone was met, resulting in KRW 25 billion in technology fee revenue in Q2 of that year.

In Q4 of last year, KRW 70.3 billion in technology fees were received. In August last year, China's National Medical Products Administration (NMPA) approved Leclaza as a combination therapy with Rybrevant, and Yuhan received a $45 million (KRW 69 billion) milestone from its partner, Janssen Biotech, for achieving the step-by-step milestone for Leclaza.

Yuhan's Q1 technology fee revenue includes royalties from Janssen's sales of Leclaza. In 2024, the Leclaza and Rybrevant combination therapy received U.S. FDA approval, and sales in the U.S. began. According to Johnson & Johnson's performance data, Q1 sales of the Leclaza-Rybrevant combination therapy reached $257 million (approx. KRW 300 billion), an 82.7% increase year-on-year.

Yuhan stated, “Prescription of the Leclaza combination therapy is expanding in major markets such as the U.S. and Europe, and we have secured a foundation for full-scale revenue growth through its listing as a 'Preferred Treatment' in the NCCN guidelines and the approval of the Rybrevant SC formulation.”

In the 2026 National Comprehensive Cancer Network (NCCN) guidelines for NSCLC, the Leclaza + Rybrevant combination therapy was included as a 'Preferred Treatment' for first-line treatment. Leclaza is the first domestically developed new drug to be incorporated into the NCCN Category 1 first-line treatment.

Yuhan received a steady inflow of technology fee revenue since 2018, when it began licensing new drug technologies.

In July 2018, Yuhan licensed the technology for the degenerative disc disease treatment YH14618 to Spine BioPharma in the U.S. It received an upfront payment of $650,000 and was guaranteed $217.5 million in step-by-step milestones based on development, approval, and sales.

In November 2018, Yuhan licensed out the anticancer drug Leclaza to Janssen Biotech. The total contract size, including a non-refundable $50 million upfront payment, is up to $1.205 billion.

In January 2019, Yuhan signed a license and co-development agreement with Gilead Sciences for a new drug candidate targeting two drug targets for the treatment of metabolic dysfunction-associated steatohepatitis (MASH). The terms included a $15 million upfront payment and $777 million in milestones based on development, approval, and sales.

In July 2019, Yuhan signed a technology transfer agreement for YH25724 with Boehringer Ingelheim. YH25724 is a dual-agonist targeting the GLP-1 protein and FGF21 factor simultaneously, with the technology transfer agreement signed during the preclinical stage. For this contract, Yuhan received a non-refundable upfront payment of $40 million. An additional $10 million milestone was generated for YH25724 in November 2021 upon entering Phase 1 clinical trials.

In August 2020, Yuhan signed a technology transfer agreement with Processa Pharmaceuticals in the U.S. for YH12852, a treatment candidate for functional gastrointestinal disorders, in which Yuhan received a non-refundable $2 million upfront payment in the form of stock. Yuhan recognized the upfront payments and milestones received from the other four companies excluding Processa, which paid in stock, in installments. 

Yuhan received total technology fee revenue in 2019 until the first quarter of this year is amounted to be KRW 465 billion. Of the Leclaza technology fee revenue secured by Yuhan, 40% is paid to the original developer, Oscotec. In 2016, Yuhan acquired the development rights for Leclaza at the preclinical stage from Oscotec and its subsidiary Genosco. The total contract size for that acquisition was KRW 1.5 billion.