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Week in Review: China Cord Blood Receives Higher Takeover Offer

publication date: Aug 8, 2015
 | 
author/source: Richard Daverman, PhD

Deals and Financings

Nanjing Xinjiekou Department Store Co. made an unsolicited offer of "not less than" $966 million to buy China Cord Blood Corp. (NYSE: CO), a cord blood banking and stem cell processing company (see story). In April, Golden Meditech (HK: 801), China Cord Blood's major owner, made a $771 million offer to take the company private. China Cord Blood has $394 million in cash and annual revenues of about $102 million. If re-listed in Hong Kong or on a China exchange, China Cord Blood could be worth $5 billion. 

Sanjiu Medical & Pharmaceutical Co., a unit of China Resources, will pay $209 million to acquire Zhejiang Zhongyi Pharmaceutical (see story). Zhongyi makes a variety of generic chemical drugs and TCM products. The present owners of Zhongyi have promised Sanjiu the company will produce a profit of $10.8 million in 2015. If that doesn't happen, the owners will make up the difference. 

Mevion Medical Systems, a Massachusetts company that makes proton therapy systems, announced a financing of up to $200 million led by two China Investors, HOPU Investments and YuanMing Capital (see story). At the same time, Mevion and the two lead investors will form a China joint venture to produce, sell and service Mevion proton therapy systems in China. Joe Jachinowski, Mevion's CEO, told ChinaBio® Today in an email that the China JV will be funded by HOPU and YuanMing, over and above their contributions to the financing. Mevion will contribute its expertise to the JV, which will include helping the JV manufacture the machine in China. 

Cold Genesys, a Los Angeles-area onco-immunotherapy pharma, raised $10 million in a Series B funding led by two China-affiliated investors, Ally Bridge Group and WI Harper (see story). One year ago, Cold Genesys raised $13.8 million in a Series A round from Ally Bridge. Cold Genesys will use the capital for a pivotal trial of CG0070, which is designed to replicate in tumors and create an immune response against cancer cells. 

Sorrento Therapeutics (NSDQ: SRNE) of San Diego in-licensed four monoclonal antibodies from Mabtech Limited, a holding company for China mAb biopharmas (see story). All four of the mAbs have completed Phase III trials in China; two of them have filed for marketing approval; the others are still undergoing data analysis. Sorrento will have rights to the mAbs in the US, Europe and Japan. Mabtech is owned by CDH Investments, an Asian private equity fund with more than $10 billion under management. No financials details were disclosed, nor did the release identify the companies that developed the molecules. 

ResMed (NYSE: RMD), based in San Diego, will acquire Curative Medical, a Suzhou company that provides non-invasive ventilation and sleep-disorder breathing medical devices (see story). ResMed also makes devices that treat sleep disorders, along with products for COPD and other chronic diseases. The price was not disclosed. ResMed said the acquisition will boost its sales in China, though each company will continue to operate separately. 

Luye Pharma (HK: 2186) announced it will invest in Singapore's Vela Diagnostics and collaborate with the company to develop diagnostics for China, which will involve drug development and companion diagnostics (see story). Founded in 2011, Vela offers real-time PCR and next-generation sequencing on an integrated platform. The new investment will be crucial to Vela because the company went into Judicial Management, a form of bankruptcy, in March 2015. Further details were not disclosed.

Government and Regulatory

The China Food and Drug Administration has proposed new drug approval rules that address its two major policy initiatives: safer, more effective drugs and quicker approvals for innovative drugs aimed at unmet needs (see story). Among other requirements, the new rules will require generic drugmakers to prove efficacy equivalence, and several of the provisions are aimed at reducing the number of generic drug applications, according to a Sidley Austin review of the proposed changes. 

Trials and Approvals

BeiGene, an innovative Beijing oncology pharma, received CFDA approval to conduct China Phase I clinical trials of BGB-283, a novel RAF dimer inhibitor (see story). BeiGene will test the drug in solid tumors with B-RAF mutations or other aberrations in the RAS-MAPK (mitogen-activated protein kinase) pathway; one of the major targets will be melanoma. In 2003, BeiGene out-licensed ex-China rights for BGB-283 to Merck Serono in a $233 million deal. BeiGene began a trial of the drug candidate in Australia in December 2003. 

China News

Pharma City, a new pharma park intended especially for China pharmas, is being established in India, near Hyderabad (see story). Eventually, the site is expected to house manufacturing facilities for 50 China pharmas. Over the last few years, India has been upset about its pharmaceutical trade imbalance with China: a greater value of China-sourced APIs is coming to India than returns to China in finished drug products. Pharma City will attempt to redress that imbalance. 

Ever the idealist, Jun Wang, former CEO of  Shenzhen sequencing company BGI, wants to use artificial intelligence on 100 million human genomes to help people live healthier, longer lives (see story). Because the data is so complex, AI will identify the combination of genes, physiological traits and patterns of daily of living that can prevent disease. With monitoring, the system may advise, for example, modifying your behavior because of the imminent onset of depression. "Maybe we will have to recruit 10 million people to get a 1-million-person complete dataset," Wang told Nature in an interview. "But who cares? Let’s just do it." 

Disclosure: none.


 

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