Deals and Financings

Vivo Capital, a US-China healthcare investment firm, has raised $1.28 billion for its ninth fund, bringing its assets under management to more than $4.3 billion (see story). Vivo invests in all stages of healthcare companies, from start-up to publicly owned. Founded in 1996, Vivo Capital is currently making investments from its $750 million eighth fund (2015) into private and public healthcare companies in the US and Greater China, from its $635 million Opportunity Fund (2018) into public healthcare companies, and from its $100 million PANDA Fund (2016) into early-stage innovative healthcare companies.

Hansoh Pharma (HK: 3692) completed a highly successful Hong Kong IPO, pricing last week at the top end of its range, and then following up with a 37% rise in its first trading session today (see story). The IPO raised $1 billion for the company at a valuation of $10.7 billion. The company is now valued at $14.7 billion. Founded in 1995, Hansoh offers more than 40 products in six therapeutic areas. It also boasts of having a large development pipeline. The enthusiastic reception for Hansoh bodes well for other China IPOs.

China's Everest Medicines signed a $121 million pact for Greater China rights to Nefecon, the lead drug of Sweden's Calliditas Therapeutics (see story). Nefecon is a novel oral formulation of the corticosteroid budesonide aimed at treating chronic autoimmune kidney disease IgA Nephropathy (IgAN). In Sweden, Calliditas has completed a successful Phase IIb trial of Nefecon as a treatment for inflammatory kidney disease in patients at risk of progressing to renal failure. Everest will pay $15 million upfront and the rest in milestones.

In a $205 million agreement, Zai Lab (NSDQ: ZLAB), a Shanghai-US biopharma, acquired Greater China rights to ripretinib, a treatment for GIST and other solid tumors developed by Deciphera Pharma (NSDQ: DCPH) of Boston (see story). Ripretinib is an oral investigational KIT and PDGFRα kinase switch control inhibitor. Zai will pay $20 million upfront and be responsible for up to $185 million in potential development and commercial milestones, plus royalties on sales. Deciphera is assessing adding China sites to its ongoing global Phase III trial that compares ripretinib to sunitinib in second-line GIST patients.

Tessa Therapeutics, a Singapore company, will form a $120 million JV with China-Singapore Guangzhou Knowledge City (CSGKC) to develop Tessa's oncology cell therapies in China (see story). The companies will fund the JV in two stages, with Tessa contributing its cell therapies plus $40 million and CSGKC $80 million in cash. In the first stage, Tessa will invest $20 million plus China rights to its technology, and CSGKC will add $40 million for a 13% stake in the JV. A clinical-stage company, Tessa is developing autologous and off-the-shelf allogeneic therapies that target a range of cancers.

Oncologie, a Boston-Shanghai biopharma, raised $80 million in a Series B funding to support its biomarker driven in-licensing of mid-stage oncology assets (see story). The round was led by existing investors Nan Fung Life Sciences and Pivotal BioVentures China, and joined by new investors including Panacea Venture Healthcare and Korea Investment Partners. Oncologie is developing three candidates for cancer including its lead molecule, bavituximab, an immune-modulatory mAb that targets phosphatidylserine, a phospholipid that inhibits the ability of immune cells to recognize and fight tumors.

GT Apeiron Therapeutics, a Shanghai novel biotech, was launched with backing from GT Healthcare Capital Partners and associated investors (see story). GT Healthcare is a Hong Kong-based private investment partnership specialized in healthcare investments, especially in Asia. Apeiron also announced a drug discovery collaboration with Exscientia, a UK AI drug discovery company. Exscientia aims to combine AI with the discovery experience of veteran drug hunters. Using Exscientia's AI platform, Apeiron expects to accelerate its novel drug development, exploring new pathways for important oncology therapeutic targets.

Shanghai's Brii Bioscience will have China rights to as many as three infectious disease candidates developed by Artizan Biosciences, a spin-out from Yale University (see story). Brii participated in a Series A funding that brought Artizan's total funds raised to $12 million, though Brii's financial commitment to the round was not disclosed. Artizan is developing intestinal microbiota candidates for inflammatory diseases including its lead candidate, a treatment for Inflammatory Bowel Disease (IBD). Artizan uses its IgA-SEQ™ technology platform to identify disease-driving bacteria contained in human intestinal microbiota. h

Deepwise, a Beijing-Hangzhou AI-based medical imaging diagnostics company, completed a Series C round of undisclosed size (see story). In three previous fundings, Deepwise raised $43 million. Formerly known as the AI Lab Project of Peking University, Deepwise was spun out of PU in 2017. The company's products are now used in 200 China hospitals. Deepwise said its success is due in part to its academic and scientific network. The C round was led by Sunshine Insurance Group, Changfazhan, SRHC and the Sunland Fund.

Government and Regulatory

China officially launched the Shanghai Exchange's new Science and Technology Innovation Board (STIB) with news that 119 companies, including 27 biopharmas, have already signed up to IPO on the new exchange (see story). For China, the STIB accomplishes two goals: high tech companies that are not yet profitable can list on a mainland exchange for the first time, and STIB IPOs will be registration-based. That means China regulators will not set the prices of IPOs, nor will they control the schedule and/or number of listing companies.

Trials and Approvals

Reistone, a one-year-old Shanghai-Beijing-Boston biopharma, dosed the first patient in global Phase II trial of its JAK1 inhibitor in patients with Ulcerative Colitis and Crohn's disease (see story). The JAK1 candidate was developed by Jiangsu Hengrui (SHA: 600276). In early 2018, Hengrui established Reistone, complete with financial backing, as a company capable of conducting global trials of China-discovered drugs, Hengrui's own and those of other companies. The JAK1 clinical trial is a randomized, double-blind, placebo-controlled, four-armed, multi-center Phase II test with safety and efficacy endpoints.

Terns Pharma, a Silicon Valley-Shanghai company, started a US Phase I clinical trial of TERN-101 to treat non-alcoholic steatohepatitis (NASH) (see story). TERN-101 is a farnesoid X receptor (FXR) agonist. One year ago, Terns in-licensed three drug candidates from Eli Lilly (NYSE: LLY), including TERN-101. At the same time, the company announced it had received $30 million in start-up capital from Lilly Asia Ventures. Terns focuses on molecularly-targeted drugs and combination therapies that treat liver diseases and liver cancer.

CStone Pharma (HK: 2616) of Suzhou will test its PD-L1 monoclonal antibody in combination with Bayer Healthcare's Stivarga® (regorafenib) as a treatment for multiple cancers including gastric cancer (see story). Stivarga is a multi-kinase inhibitor that targets VEGFR, FGFR, CSF1R, etc. The two companies described the collaboration as a global effort with a China emphasis. CStone will be the study sponsor and Bayer will provide regorafenib throughout the clinical trial program.

Xynomic (NSDQ: XYN), a US-China oncology pharma, completed a pre-IND meeting with the US FDA for its pan-RAF inhibitor XP-102 (see story). It said the FDA provided valuable advice on its clinical development plan for the candidate. The company, which thinks XP-102 may prove to be best-in-class, hopes to file for XP-102 in the second half of 2019. In 2017, Xynomic announced a $502 million agreement to acquire global rights to the molecule from Boehringer Ingelheim.

Disclosure: none