LG Chem said Friday that it has signed a contract with Sprint Bioscience to cooperate on developing new drugs for non-alcoholic steatohepatitis (NASH) and metabolic diseases.

Under the accord, LG Chem and Sprint will select candidates for clinical development through initial joint research, while LG Chem will proceed independently from preclinical to global licensing and commercialization.

The company plans to use Sprint's fragment-based drug design technology to finalize its drug development candidates and proceed with clinical development to advance into the global market.

LG Chem will also secure exclusive global rights of the project while giving Sprint milestone payments according to the achievement of development and commercialization step. After commercialization, LG will pay royalties according to sales of the approved the drug.

“Combining Sprint's high-quality early research capability and LG Chem's development capabilities, we will provide new treatment options for NASH patients worldwide,” said Son Jee-woong, head of LG Chem's life science business division.

Sprint Bioscience CEO Anders Aberg also said, “The company believes that LG Chem is the best partner as it has experience in diabetes and metabolic disease drug development. Through this partnership, Sprint has proved once again the excellence of its candidate substance derivation technology around the world.”

According to GlobalData, a market analyst firm, the market for the treatment of NASH in 2016 was about 700 billion won ($618 million). As of now, however, there are no drugs approved to cure NASH completely, and patients receive off-label treatments such as Vitamin E and conventional diabetes treatment.