Deals and Financings

WuXi AppTec, China's largest CRO/CMO, secured a five-year $1.5 billion line of credit from Ping An Bank, a subsidiary of the China insurance company (see story). Details of the agreement were not disclosed, but the agreement apparently includes some form of partnership. The primary goal seems to be healthcare, centered on six major cities including Shanghai. Ping An is no stranger to WuXi: it was one of the investors in WuXi's $3.3 billion privatization last year. Reports recently surfaced that WuXi in planning to IPO its biologics R&D and manufacturing businesses in a Hong Kong IPO that values the division at $1.5 billion. 

Shanghai Fosun Pharma (SHA: 600196; HK: 02196) is once again raising capital, this time through a $471 million issue of China bonds (see story). The deal-happy company is always is need of cash because it spends freely on M&A transactions. One year ago, Fosun raised $935 million in a private placement of shares, a move that sent its shares 17% higher. The reaction to the latest news was a more muted low-single-digits rise. 

China Medical System Holdings (HK: 0867) agreed to pay $500 million for two established AstraZeneca (NYSE: AZN) cardiovascular drugs (see story). The agreement includes $310 million to in-license China rights for Plendil, a hypertension drug of the calcium channel blocker class, and another $190 million for global rights (ex-US) for Imdur, an anti-angina nitrate drug. CMS markets prescription drugs in China. 

Gloria Pharma (SHZ: 2437) of Harbin, China will invest $40 million in Proteus Digital Health, a US company with a remote patient monitoring device (see story). As a sweetener for the investment, Gloria will have an exclusive 18-month option to form a China JV with Proteus. Proteus expects to raise a total of $110 million in its current H funding round. Gloria will purchase $25 million of Proteus' preferred stock, and will invest another $15 million through Shanghai Sailing Boda Equity Investment Fund Partnership. 

Yuhan, a South Korean pharma, has formed a JV with San Diego's Sorrento Therapeutics (NSDQ: SRNE) to develop several Sorrento immune checkpoint antibodies (see story). Yuhan will invest $10 million and own 51% of the JV. Initially, the JV, called ImmuneOncia, will own global rights (excepting the US, Europe and Japan) to one Sorrento drug candidate. The JV will later select two additional Sorrento candidates from a list. Sorrento is developing biosimilar and biobetter antibodies for cancer, inflammation and autoimmune diseases along with clinical-stage CAR-T therapies as treatments for solid tumors. 

3DMed, a Shanghai biotech, and Suzhou's Alphamab have decided to join forces to develop KN035, a PD-L1 immuno-oncology drug discovered by Alphamab (see story). Unlike most PD-L1 mAbs, KN035 is an injected product that the companies hope will be more effective and cause fewer side effects than the competition. 3DMed and Alphamab will develop KN035 equally. They expect to file for China clinical trial approval in Q2 and begin the trials before the end of the year, with US trials following later. Further details of the agreement were not disclosed. 

CRO/CMO News

WuXi AppTec reported that Shanghai SynTheAll Pharmaceutical, its small-molecule process development and CMO subsidiary, began operations last month in its new Changzhou facility (see story). The facility, which began construction in 2014, was expected to cost $100 million and offers fully integrated R&D and cGMP services. In 2015, SynTheAll listed on China's Third Board. A few months later, it raised $80 million by selling 6% of STA's shares at a valuation of $1.1 billion for the subsidiary. 

Trials and Approvals

Hutchison China MediPharma (AIM: HCM, the novel drug discovery division of Chi-Med, has begun a China Phase II trial of sulfatinib (HMPL-012) in patients with thyroid cancer (see story). The drug candidate is already undergoing four other trials for patients with neuroendocrine cancer in both China and the US. Sulfatinib has a dual anti-angiogenesis mechanism, attacking VEGFR and FGFR1 tyrosine kinase receptors. The first patient in the latest trial was dosed on March 1, 2016. 

Disclosure: none.