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The Week in Review: Fundings for China-Affiliated Drug Companies
publication date: Aug 10, 2013
author/source: Richard Daverman, PhD
Deals and Financings
Shenogen Pharma of Beijing raised $20 million in a series C funding, which the company will use to support a Phase II trial of its lead drug candidate, icaritin, a small molecule drug that targets the estrogen receptor alpha 36 (see story). The trial will enroll patients with hepatocellular cancer. The drug is derived from barrenwort, a TCM. The funding was led by Legend Capital and Qiming Weichuang Venture Capital. Investors also received warrants to buy an additional $10 million in shares.
Apexigen, a California antibody company with strong connections to several China pharmas, brought in $20 million in a Series A1 financing (see story). Apexigen was originally the drug development arm of Epitomics, a company built around a rabbit-based platform for developing monoclonal antibodies. Two China companies – Simcere (NYSE: SCR) and 3SBio (NSDQ: SSRX) – have filed with the CFDA to begin clinical trials of Apexigen-discovered drugs.
Zhongyuan Union Stem Cell Bioengineering (SHA: 600645) formed a stem cell JV with Cell Therapy Ltd. of Wales (see story). The JV will focus on developing stem cell therapies for major diseases such as heart disease and diabetes, presumably based on CTL’s technology. It plans to build two operational hubs near Shanghai and Beijing, with smaller offices in other China cities. The two firms will share the JV’s China revenues equally, while Cell Therapy will have first option on Zhongyuan Union's products outside China.
Sinopharm Group will build a China Biotechnology Research Institute in Wuhan East Lake High-tech Zone, gathering together its existing biotech R&D resources into one location (see story). The facility will be part of a Sinopharm subsidiary, the China Institute of Pharmaceutical Industry. Sinopharm says the Institute will be the largest biotech R&D operation in China, comprising two to three separate buildings. Construction will take three years.
ScinoPharm (TAI: 1789), a Taiwan CRO with expertise in process development and generic API production, formed a strategic alliance with Sundia MediTech Company, the Shanghai CRO (see story). The two companies will collaborate to provide Contract Research and Manufacturing Services (CRAMS) in China. ScinoPharma will participate through its China subsidiary, ScinoPharm Changshu.
Mitsubishi Tanabe Pharma will spend $19.5 million to build a new China production facility in Tianjin (see story). The plant will be owned by Tianjin Tanabe Seiyaku, a joint venture in which Mitsubishi holds a 75% stake. Its local partner, Tianjin Lisheng Pharmaceutical Co., owns the remaining 25%. The new facility will be built on the JV’s existing site in the Tianjin Economic Development Area.
Komtur Pharmaceuticals, a German clinical trial sourcing company, set up a China JV with HengHeKangJian Pharmaceutical (see story). The JV will build a state-of-the-art distribution center that is compliant with the latest China and international standards. It will offer distribution of clinical trial supplies and sourcing of reference drugs. The JV will also provide commercial distribution of finished pharmaceuticals and medical devices, and will eventually move into pharmaceutical labeling and re-packaging.
Allium Medical (TASE: ALMD) of Israel signed up Beijing King Health Investment to distribute the company's urinary tract stents in China (see story). King Health agreed to buy at least $16 million of Allium's stents during the eight-year run of the contract. The two companies expect to launch the urinary stents in 2016, assuming CFDA approval.
Trials and Approvals
A JV consisting of Zoetis (NYSE: ZTS), the recently spun-off animal health subsidiary of Pfizer (NYSE: PFE), and Jilin Guoyuan Animal Health Co. has received marketing approval in China for a new swine vaccine (see story). Rui Lan An™ targets highly pathogenic porcine reproductive and respiratory syndrome (HP PRRS). The JV, which was announced in 2011, will launch the vaccine immediately. Zoetis/Pfizer and Jilin Guoyuan formed the JV to meet the needs of China’s livestock producers, particularly the pork industry.
According to press reports, Sanofi (NYSE: SNY) paid China doctors kickbacks to prescribe its blood pressure drugs (see story). An anonymous whistleblower alleged that the company’s representatives paid 1.7 million RMB ($280,000) to over 500 doctors in 79 hospitals – about $500 each. The illegal payments, which were made in November 2007, were billed as research fees or grants, said the whistleblower.
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