Shares of Innocare (09969) experienced a volatile trading session on Wednesday. After announcing a major partnership agreement at midday, the stock initially pared its losses to less than 1% in the afternoon session. However, selling pressure quickly returned, driving the share price down by more than 10%.

At the time of writing, the stock was trading down 10.35% at HK$14.12, with turnover reaching HK$272 million.

The market-moving news came on September 24, when Innocare announced it had signed a research collaboration and exclusive licensing agreement with Eli Lilly. The two companies will pursue a strategic partnership in innovative drug development, with Innocare leveraging its proprietary drug discovery platform and deep research expertise to identify and develop up to five innovative target programs aimed at addressing significant unmet clinical needs.

Under the terms of the agreement, Eli Lilly will pay Innocare an upfront payment and near-term milestone payments totaling up to $100 million. The potential total for research, development, and commercialization milestones could reach approximately $3.25 billion. Additionally, Innocare is entitled to receive tiered royalties in the low single-digit percentages based on annual net sales of licensed products.