Terns Pharmaceuticals has signed an agreement to acquire the exclusive rights to develop, register and market GENFIT’s elafibranor.

The drug is a dual peroxisome proliferator-activated alpha/delta (PPAR a/δ) agonist indicated for the treatment of non-alcoholic steatohepatitis (NASH) and primary biliary cholangitis (PBC).

Under the licensing and collaboration agreement, Terns will acquire the right to commercialise elafibranor in Greater China, including Hong Kong, Macau and Taiwan.

GENFIT will be eligible for a $35m upfront payment and up to $193m in subsequent funding if certain clinical, regulatory and commercial milestones are achieved.

Terns and GENFIT will partner in research and development (R&D) activities for NASH and PBC therapeutics.

NASH is a severe form of non-alcoholic fatty liver disease that is caused when excess fat accumulates in the liver, while PBC is a chronic disease that hinders the liver’s ability to remove toxins from the body. This can result in scarring of liver tissue known as cirrhosis.

The partners’ R&D efforts will investigate potential combinations of elafibranor with Terns’ development candidates, including TERN-101 and TERN-201, as well as thyroid hormone receptor (THR) δ-selective agonist and apoptosis signal-regulating kinase 1 (ASK1) inhibitor programmes.

Terns Pharmaceuticals CEO Weidong Zhong said: “We believe combination therapy will rapidly become the standard of care for NASH treatment, and our strategy is based on this conviction.

“Elafibranor is a late-stage compound with a mechanism of action synergistic with those in our own pipeline, making it a perfect fit for our strategy to advance combination therapies for chronic liver disease.”

Terns’ agreement with GENFIT follows the announcement made last year that it acquired the global, exclusive rights to develop and commercialise three NASH assets from Eli Lilly and Company.