China-Based Zhifei Biological Partners With GSK To Expand Shingrix Vaccine Access Across China Via £2.5B Deal

GSK plc GSK has reached an exclusive agreement with Chongqing Zhifei Biological Products, Ltd to co-promote GSK's shingles vaccine, Shingrix, in China for an initial three-year period with the potential to extend the partnership should all parties agree. 

In Q2, Shingrix sales increased 20% to £880 million. Zhifei is the largest Chinese vaccine company by revenue. 

The partnership will significantly extend the availability of Shingrix, supporting the rapid expansion of patient access to the vaccine and future potential indications.

Set to start on 1 January 2024, Zhifei will have exclusive rights to import and distribute Shingrix in China – focusing on promoting the vaccine through its extensive service network, covering more than 30,000 vaccination points nationwide. 

In August 2023, GSK announced data from the ZOSTER-076 phase 4 trial showing that Shingrix demonstrated 100% vaccine efficacy in preventing shingles in Chinese adults aged 50 and over. 

Zhifei will purchase agreed volumes of Shingrix with a value to GSK of £2.5 billion over the initial three-year period. 

The partnership supports and accelerates GSK's commitment to double global Shingrix sales, reaching more than £4 billion by 2026.

Under the terms, Zhifei has granted GSK the right of first refusal to be their exclusive partner for any co-development and commercialization of an RSV vaccine for older adults in China, paving the way for the companies to potentially partner on Arexvy upon approval in China.

Citing JPMorgan analysts, Reuters noted that the announcement "de-risks GSK's Shingrix China sales for the next three years" holds the potential for a 6% upgrade to 2026 consensus Core EPS forecasts.

Price Action: GSK shares are up 0.53% at $36.85 on the last check Monday.