11:32 AM EDT, 03/25/2025 (MT Newswires) -- Merck ( MRK ) secured exclusive global rights to develop and sell China-based Jiangsu Hengrui Pharmaceuticals' heart disease drug in a deal worth up to about $2 billion.

The companies said Tuesday that they signed a licensing agreement for the investigational product called HRS-5346, which inhibits the formation of cholesterol, fats and proteins to ensure a smooth blood flow. Limited blood flow can result in heart attacks, strokes and other cardiovascular diseases.

Under the deal, Merck ( MRK ) will develop, manufacture and commercialize the drug around the world, excluding the greater China region, according to the announcement.

Merck ( MRK ) will make an upfront payment of $200 million to Hengrui Pharma, and up to $1.77 billion in milestone payments. The Chinese company is also entitled to royalties on net sales, if approved.

HRS-5346 "expands and complements our cardio-metabolic pipeline," Merck Research Laboratories President Dean Li said in a statement.

The transaction, which requires regulatory clearance in the US, is expected to complete in the second quarter. HRS-5346 is currently being evaluated in a phase 2 clinical trial in China.

"We believe Merck's ( MRK ) clinical expertise and global scale will help accelerate the development of HRS-5346 and potentially provide more patients with an additional option to reduce their risk of atherosclerosis," Hengrui Pharma Chief Strategy Officer Frank Jiang said.

Merck ( MRK ) anticipates recording a pretax charge of $200 million, or $0.06 per share, in the quarter the transaction closes.

The move follows Merck's ( MRK ) licensing deal with China's Hansoh Pharma in December to develop and sell an oral weight loss drug.

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