US biopharmaceutical company Celgene has agreed to buy a stake in China’s BeiGene and help to develop and commercialize that company’s investigational treatment for tumor cancers.

As part of the transaction, Celgene will acquire 5.9% of BeiGene's ordinary shares for $4.58 each or its American Depository Shares (ADS) for $59.55 each. The Chinese firm will receive $263 million in upfront license fees and $150 million equity investment as well as being eligible to receive up to $980 million in development, regulatory and sales milestone payments.

Following the transaction, plans call for BeiGene to acquire Celgene's operations in China and also license and assume commercial responsibility for the US company’s approved therapies in China.

BeiGene's advanced clinical-stage investigational treatment, designated as BGB-A317, is a type of antibody belonging to a class of immuno-oncology agents known as immune checkpoint inhibitors. According to reports, the treatment has been tested in over 500 patients, with initial clinical data suggesting it is well tolerated and exhibits anti-tumor activity across a range of solid tumor types.

The Chinese biopharmaceuticals producer will retain exclusive global rights for the development and commercialization of BGB-A317 for malignancies related to blood-forming tissues and for solid tumors in Asia, excluding Japan.

Celgene also has a partnership with AstraZeneca to develop Imfinzi (durvalumab) for the Chinese market. The drug approved in May of this year by the US Food and Drug Administration (FDA) for treatment of certain patients with locally advanced or metastatic urothelial carcinoma emerged from the labs of the Anglo-Swedish drugmaker’s global biologics R&D arm, Medimmune.