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Week in Review: Zhejiang Wolwo Bio-Pharm Stages $84 Million Shenzhen IPO

publication date: Jan 25, 2014
 | 
author/source: Richard Daverman, PhD

Deals and Financings

Zhejiang Wolwo Bio-Pharmaceutical (SHE: 300357) completed a very successful IPO, a 506 million RMB ($83.7 million) transaction that listed the company on the Shenzhen exchange (see story). It was one of the initial eight China companies to become publicly owned after China shut down the IPO process for 14 months. Regulators revamped the country’s IPO process to make it more market oriented. Wolwo finished the week with a strong 94% gain. After pricing at 20.05 RMB, it climbed to 38.81 RMB.

TaiGen Biotechnology (TWO: 4157), a Taiwan biopharma with a Beijing subsidiary, raised $35.7 million in an IPO on Taiwan’s GreTai market (see story). The company’s shares rose 6% in the first trading session, giving TaiGen a valuation of $1.1 billion. TaiGen said it would use the capital to advance its discovery and development pipeline. TaiGen has raised a total of $131 million in venture capital since it was founded in 2001.

Harbin Gloria Pharmaceuticals in-licensed China rights to a hypertension treatment developed by Korea’s Boryung Pharma, paying $5.4 million upfront (see story). Fimasartan, known as Kanarb, is a novel non-peptide angiotensin II receptor antagonist (ARB), which acts as a vasodilator. It has been marketed in Korea since 2011. As part of the deal, Gloria promised a minimum of $75 million in China sales over the next ten years.

Government and Regulatory

A US judge ordered the Big Four accounting firms to suspend China operations for six months. The problem? A conflict between US and China legal systems (see story). US regulators want to see working documents from audits of China companies that may have committed fraud. In the US, the Securities and Exchange Commission has the right to see those documents, but in China, they are declared secret. The Big Four, operating under China rules, cannot provide them. The order affects China companies that are listed in the US such as WuXi PharmaTech (NYSE WX) and Mindray Medical (NYSE: MR).

Company News

Abcam plc, a UK company that provides protein research tools, will open a new Shanghai office next month in Zhangjiang Hi-Tech Park (see story). The new office will develop additional distribution channels to serve rapidly growing markets. Abcam already owns a 200-employee production facility in Hangzhou, which it acquired when it bought Epitomics in 2012 for $170 million. Epitomics developed RabMAb®, a proprietary rabbit-based monoclonal antibody technology.

Public Health

Unfortunately, the H7N9 avian flu is back. So far in 2014, there have been over 40 cases reported in China, causing two deaths in Shanghai Province and one in Guangdong (see story). In the previous outbreak, about one-fourth of the people diagnosed died from the virus. This year, the virus does not seem to be as deadly, but it is more widespread, making it more difficult for health officials to take decisive action that would wipe out the virus.

Disclosure: none.


 

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