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Week in Review: WuXi Healthcare Ventures II Files for $250 Million Fund

publication date: Jul 18, 2015
 | 
author/source: Richard Daverman, PhD

Deals and Financings

Cayman Islands-based WuXi Healthcare Ventures Fund II, L.P. has filed paperwork with the US SEC for a $250 million life sciences venture fund (see story). In March 2015, WuXi AppTec's (NYSE: WX) board of directors decided to commit up to $50 million as an anchor investment for WuXi Healthcare Ventures Fund II, with an additional $200 million to come from outside investors (see WuXi Form 20-F). In 2011, WuXi AppTec started its original WuXi Venture Fund with $50 million. By the end of 2014, it had invested $36.1 million in 18 life science companies and recognized gains of $16.6 million on exits. 

Zhongzhi Pharma Holdings (HK: 3737) raised $73 million in a Hong Kong IPO (see story). Located in Zhongshan, Guangdong province, the company makes patented TCM drugs under three brand names: Zeus, Liumian and Caojinghua, It also owns a chain of 201 Zeus pharmacies that sell its own products along with other companies' offerings. Because of the weakness in China's and Hong Kong's markets, the shares fell about 3% in the first day of trading. 

Phoenix Healthcare (HK: 1515), a company with a portfolio of private hospitals in the Beijing area, paid $23.2 million for a 20% stake in UMP Healthcare (see story). UMP operates out-patient clinics, mainly in Hong Kong, but also in Shanghai, Macau and Beijing. In addition, the two companies will form a 50-50 joint venture to build clinics in the Beijing-Tianjin-Hebei region. Initially, the JV will build three clinics in Beijing, with plans to have at least 10 facilities over the longer term. 

Frontage Labs, a US-China CRO majority owned by Hangzhou Tigermed (SHE: 300347), acquired BDM Consulting of Summerset, N.J., a biostatistics firm (see story). The price was not disclosed. Tigermed already owned a 55% interest in BDM; so Frontage's purchase of a 45% stake gives it and Tigermed exclusive co-ownership. Frontage offers pre-clinical and clinical CRO services in the US and China, while Tigermed is a China clinical-stage CRO. 

CANbridge Life Sciences of Beijing in-licensed China rights to a clinical-stage anti-TNF drug candidate from Apogenix, a German biopharma, as a treatment for glioblastoma multiforme in China, Macao and Hong Kong (see story). CANbridge will also have an option for other indications. The drug, APG101, is a fully-human fusion protein designed to inhibit the CD95 ligand and restore the immune response against tumors. Apogenix will receive upfront and milestone payments, plus royalties at tiered, double-digit rates on China revenues. 

Company News

Jiangsu Hengrui Medicine (SHA: 600276) announced plans to spend $137 million building a new biologic drug manufacturing facility in Suzhou (see story). The facility will be part of new Suzhou subsidiary, named Suncadia, which was recently established with $16 million in initial capital. Hengrui spends 10% of its $1.2 billion in revenues on new-drug R&D, and the company has formed several high-visibility innovative drug collaborations. 

Trials and Approvals

Aoxing Pharma (NYSE: AXN), a US-headquartered company whose operations are in China, reported positive results from a China registrational trial of buprenorphine/naloxone sublingual tablets as a treatment for opioid dependence (see story). Aoxing has a license to produce narcotic drugs in China, and buprenorphine is an opioid derivative. Last week, Aoxing received marketing approval for its Tilidine Hydrochloride pain medication, a synthetic opioid that is used to treat pain in several countries around the world. 

A giant gastric cancer screening study, which will test at least 20,000 people in 50 hospitals, has started in China, using the GastroPanel test developed by Finland's (HEL: BIOBV) Biohit Oyj (see story). The goal is early detection of gastric cancer, a prevalent form of cancer in China. One year ago, Biohit Oyj formed a JV with Anhui Wisdom-Win Investment Co. to make and distribute the GastroPanel in China. 

Government and Regulatory

Focusing primarily on the cost of generic drugs will cause problems in quality, declared Jingquan Bi, Minister of the CFDA, in a rare public appearance (see story). If price is the major concern, drugmakers will eventually use substandard ingredients and cut other corners, resulting in ineffective products, he said. The CFDA's focus must be on equivalency of generic drugs to the originator product. If a generic passes the equivalency test, Bi believes the government should support the product. Although drugmakers want the CFDA to concentrate on speeding up approvals of new products, Bi stressed the need to test new and existing generic drugs. 

Disclosure: none.


 

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