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The Week in Review: IPOs, Patents, Investment Funds and More

publication date: Oct 3, 2009
 | 
author/source: Richard Daverman, PhD
As China takes a week off to celebrate the 60th anniversary of the People’s Republic, ChinaBio® Today covered three stories with longer-term impact during this past week’s coverage, particularly the re-emergence of life science IPOs, the now-enacted amendments to China’s patent law, and two new sources of life science investment capital.
IPO (see story). Sanjin was anything but a one-shot phenomenon, because three other pharma-connected IPOs have followed Sanjin. Three more China pharmas are set to IPO on the new GEM exchange, probably this month. We look at the companies and investors’ reactions to them.

The Third Amendment to China’s Patent Law took effect on October 1, 2009, with the overall goal of bringing China’s patent rules into greater conformity with worldwide standards (see story). For the government, one of the main purposes of the Third Amendment was to strengthen intellectual property protection and promote adherence to the new rules by increasing penalties.

On the investment front, China Construction Bank (HK: 0939) announced a 2.6 billion RMB ($380 million) private equity fund aimed at expanding-to-mature China healthcare companies that have not made their IPOs (see story). The goal of the fund is to invest in companies at a price-earnings ratio of ten. The new fund reflects the growing importance of RMB-denominated funds in China.

Shenzhen has adopted a Biotech Industry Development Plan (2009-2015) that includes a commitment to invest 500 million RMB ($73.5 million) annually for the seven-year duration of the plan (see story). The goal is to make Shenzhen a leading biotechnology center. The specific goals for the plan include helping to build three major biotech companies whose revenues will total more than 10 billion RMB ($1.5 billion), and developing five innovative drugs with worldwide patents.

Zhangjiang Hi-Tech Park Development Co. of Shanghai will invest another 48 million RMB ($7 million) in its venture capital subsidiary, Haocheng Venture Capital so that Haocheng can purchase a .4% stake in Shandong Buchang Pharmaceutical (see story). Zhangjiang will purchase the shares from Shenzhen China Euro Capital. They carry a provision requiring Shenzhen China Euro to take back the shares if Buchang Pharma does not list its shares by the end of 2013.

The Anti-Monopoly Bureau of China’s Ministry of Commerce (MOFCOM) has given its okay to the merger between Pfizer (NYSE: PFE) and Wyeth (NYSE: WYE) (see story). However, MOFCOM will require that Pfizer divest its swine mycoplasmal pneumonia vaccine business.

Eli Lilly (NYSE: LLY) plans to double its workforce inside of China this year, bringing the total up to 2,000 (see story). At the same time, the company announced a 5,500 employee reduction in its worldwide staff count that will help trim $1 billion in annual costs. Inside China, Lilly will double its sales force from 800 to 1600 so that it can expand its coverage in central and western areas of the country. The company will also add operations and accounting personnel.

Sinovac Biotech (NYSE: SVA) (北京科兴生物制品有限公司) announced a second large H1N1 flu vaccine order from China’s national government (see story). The new order is for an additional 3 million doses, which follows the original 3.3 million dose order of early September. Sinovac expects to deliver 4.5 million doses of its PANFLU.1 flu vaccine to the government by the end of October.

Kyorin Pharmaceutical Co. has licensed the ex-Japan Asian rights of its overactive bladder treatment to Eisai Co. (TSE: 4523), a fellow Japanese pharma (see story). Uritos® Tablets (imidafenacin) was discovered by Kyorin, which has marketed the product in Japan since 2007. Eisai will own marketing rights for China, India, Sri Lanka and ASEAN countries. Kyorin and Eisai will work together to get the product approved for sale in these countries.

Health Robotics of Italy has signed a five-year exclusive agreement with SINOPHARM Foreign Trade to distribute and support its IV robots inside China (see story). The company’s two products are CytoCare™ for hazardous materials such as chemotherapy and i.v.STATION™ Robots for non-hazardous drugs.

Disclosure: none.



 

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