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Week in Review: Jiangsu Hansoh to Raise Up to $3 Billion in Hong Kong IPO

publication date: Sep 8, 2018
 | 
author/source: Richard Daverman, PhD

Deals and Financings 

Hansoh, a China pharma based in Lianyungang, Jiangsu province, has applied to stage an IPO on the Hong Kong exchange (see story). Unlike most companies seeking Hong Kong IPOs, Hansoh is both profitable and established. It claims to be one of the top 30 biopharmas in China, with revenues of $900 million in 2017. Two years ago, when rumors of a Hong Kong IPO first surfaced, it was thought Hansoh's debut would raise between $1.5 and $3 billion. No estimates for this IPO have are publicly available.

Quan Capital, a Shanghai healthcare investor, filed to raise $300 million for its second fund (see story). In August 2017, the firm closed its first fund with $150 million. Globally, Quan seeks investments in biopharmas with potentially breakthrough products, while in China it targets companies with innovative services for China's drug development sector. The company has very close ties to Shanghai's Zai Lab (NSDQ: ZLAB): Quan is headed by Dr. Samantha Du, founder and CEO of Zai, and Dr. Marietta Wu is a Managing Director at Quan and also a Founder of Zai.  

Zai Lab (NSDQ: ZLAB) completed a $150 million secondary offering of NASDAQ-listed shares, selling 7.5 million ADS at $20 each (see story). All together, Zai is developing eight drug projects, six of them in clinical trials. The company is reported to have a $300 million Hong Kong IPO in the works, and on Tuesday, Quan Capital, which shares its top management with Zai, though the two companies are organizationally separate, filed to raise $300 million for its second healthcare VC fund. Zai's stock has dropped 23% since the secondary was first announced last week.  

Guangdong Jianke Pharmaceutical raised $130 million in a funding round for its online pharmacy and medical advisory operations (see story). The company, which claims to be  largest B2C pharmacy in China, has over 100 million customers, plus physical and internet hospitals. It is estimated to have a value of $500-$600 million and expects to IPO in the US sometime in 2019, after it completes one additional financing. The current round was led by GTJA, a Shenzhen healthcare investor.  

Ming Capital of Shenzhen led a $33 million Series D round in Belgium's Miracor Medical SA, a medical device maker (see story). Miracor will use the capital to continue developing its PiCSO® Impulse System, an interventional cardiology device used to improve perfusion following an acute myocardial infarction. Miracor focuses on devices that treat cardiac disease. Ming Capital was joined by an unnamed strategic investor who co-led the round along with investors Quest for Growth of Belgium, SFPI and Meusinvest. 

Guangzhou Wondfo Biotech has formed a JV with Biocartis Group of Belgium to commercialize Biocartis' molecular diagnostics Idylla system in China (see story). Wondfo provides medical diagnostic tests and testing equipment to global markets. The Idylla device is an automated, real-time Polymerase Chain Reaction (PCR) molecular diagnostics system, designed for clinical use. Biocartis and Wondfo will each own a 50% stake in the JV, which they will fund with a total of $16 million in equity.  

Eccogene Biotechnology of Shanghai completed a $14.6 million Series A round led by Sinopharm Capital (see story). The company, which was established in January 2018, focuses on new-generation small molecule novel drugs that meet clinical needs at an affordable cost. The company is led by Jingye Zhou, Co-founder and CEO, who previously worked at Lilly (NYSE: LLY) and GlaxoSmithKline (NYSE: GSK). Eccogene has established its own drug R&D team, through it plans to use the services of CRO, CMO and clinical research platforms.  

BeiGene (NSDQ: BGNE; HKEX: 6160), a Beijing novel oncology company, will collaborate with New York's SpringWorks Therapeutics, combining BeiGene’s RAF inhibitor with SpringWorks' MEK inhibitor to treat patients with advanced solid tumors (see story). BeiGene will be in charge of the initial Phase I global trial, though the two companies will split the costs evenly. SpringWorks will be responsible for a fixed-dose formulation of the combination therapy.  

Ark Biosciences, a Shanghai-Suzhou clinical stage biotech, has in-licensed global rights to a treatment for idiopathic pulmonary fibrosis (IPF) from Roche (SWX: ROG) (see story). Ark believes the candidate, which has completed its first-in--human trial, has the potential to become standard-of-care. Ark will be responsible for milestone and royalty payments, and Roche will retain certain preferential rights, though further details were not disclosed. Ark has its own innovative drug R&D operations for respiratory and infectious disease, while also in-licensing promising candidates.  

Boehringer Ingelheim and Tsinghua University will collaborate to discover and develop immunological therapies for infectious diseases, particularly for tuberculosis and chronic hepatitis B, which remain problems in China (see story). As in immuno-oncology, the effort will seek to activate the innate immune system. Although vaccines have lowered the effect of infectious diseases, infections are developing resistance to anti-microbial treatments. Bacterial/viral pneumonia and tuberculosis remain a leading cause of death globally.  

Trials and Approvals 

Hutchison China MediTech (Chi-Med) (AIM/NSDQ: HCM) reported its lead candidate, Elunate® (fruquintinib), was approved in China for third-line use as a metastatic colorectal cancer treatment (see story). Chi-Med said Elunate is the first China-discovered and developed drug approved for an oncology indication following a clinical trial. Chi-Med partners the China rights to Elunate with Lilly (NYSE: LLY), which will be responsible for marketing the drug. The approval triggered a $13.6 million milestone payment from Lilly to Chi-Med.  

Eisai (TYO: 4523) and Merck/MSD (NYSE: MRK) announced the China National Medical Products Administration (NMPA) approved Lenvima® (lenvatinib) as a first-line treatment for unresectable hepatocellular carcinoma (see story). It is the first China approval for Lenvima, where the incidence of HCC is high, and the first new systemic therapy approved in China for first-line treatment of unresectable HCC in ten years. The NMPA completed its review in 10 months under Priority Review procedures.  

Company News 

Driver, a US-China startup, which bills itself as "the cure for cancer treatment," offers to match cancer patients with the best treatment for their particular disease, including clinical trials of novel drugs (see story). After three years in development, the company will start enrolling patients, charging $3000 in a one-time upfront payment and a $20 monthly fee. So far, Driver has raised $90 million, including an investment from Li Ka-shing, the Hong Kong billionaire who founded the Hutchison conglomerate.  

Disclosure: none.


 

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