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Week in Review: China Resources Pharma Stages $1.8 Billion Hong Kong IPO

publication date: Oct 29, 2016
 | 
author/source: Richard Daverman, PhD

Deals and Financings

Following its $1.8 billion IPO, China Resources Pharmaceutical Group (HK: 3320) began trading on the Hong Kong exchange (see story). In the first trading session, the stock dropped about 1% to HK$9.01 from its offering price of HK$9.10, the middle of the offering range. CR Pharma priced its IPO at a modest 14.5 times earnings. The company is part of the larger state-owned China Resources conglomerate, and it, in turn, is parent to three China-listed pharmas. CR Pharma is China's second-largest drugmaker, with extensive holdings in drug manufacturing (both western and TCM) plus its large China drug distribution operation. 

WuXi PharmaTech, the China-US CRO/CMO, participated in the $116 million Series B funding of Unity Biotechnology (see story). Unity, a San Francisco biotech, is developing therapies that eliminate senescent cells from the body. The company has identified molecules that target aging diseases such as osteoarthritis, glaucoma and atherosclerosis. Unity is 18 months away from a Phase I trial that tests a candidate for treatment of arthritis of the knee. According to BioCentury, Unity's Series B is the 12th-largest it has seen in 22 years. 

Guangdong Kanghua Healthcare is on track to complete a $154 million IPO in Hong Kong in early November (see story). The company owns two private hospitals in Dongguan, a city in China's southern Guangdong province, with a total of 2,486 registered beds. Currently, a regional hospital operator, Kanghua must expand geographically to grow. It will devote 35% of the IPO's proceeds to buying other China hospitals. Ultimately, it plans to own 30 hospitals with 15,000 beds, according to the company's chairman, Junyang Wang. 

Pluristem Therapeutics (NSDQ/Tel Aviv: PSTI), an Israeli regenerative medicine company, signed a term sheet for a $30 million investment from China's Innovative Medical Management (SHZ: 002173) (see story). Pluristem develops placental cells using a proprietary, three-dimensional bioreactor to expand cells. The company plans to start a Phase III trial of its PLX-PAD cells for critical limb ischemia in Japan and Europe next year. Innovative Medical, which is active in life science, owns three large hospitals in China along with other life science investments. 

Athenex Pharma struck a deal with Beijing Sciecure Pharma to market five of Sciecure's injectible oncology products in the US (see story). Athenex, a New York-Chongqing pharma, is developing proprietary cancer drugs, and it forms partnerships with pharmas to offer their products to the US market The company's in-licensing strategy helps to underwrite its R&D program. Athenex will build a US sales-marketing effort for the Sciecure products, which it will use eventually for its own products. Athenex also has first rights to oral Sciecure products in the US. 

Trials and Approvals

The CFDA officially announced the results of its year-long "Self-Examination" experiment, an initiative that required pharmas to verify the clinical trial data in their requests for drug marketing approvals (see story). Fifteen months ago, the agency selected 1622 registration requests for the experiment. The pharmas were asked to attest that all clinical trial data in the submissions met standards for authenticity, integrity and compliance. Over time, 83% of the requests were withdrawn. Of the remainder, about half (117) have been examined, and 26% of them (30) were found to be deficient in some manner. 

Yisheng Biopharma, a Beijing biopharma, has been granted Orphan Drug Designation in the US for its hepatocellular cancer immunotherapy (see story). YS-ON-001, which is Yisheng's lead product candidate, is expected to begin clinical trials in multiple countries soon. According to Yisheng, YS-ON-001 produces immunomodulating effects, such as inducting anti-tumor cytokines, activating NK cells, regulating macrophage polarization and suppressing regulatory T cells. Yisheng makes immunological and vaccine products. 

Biohit Oyj (HEL: BIOBV), a Finnish medical diagnostics company, reported that its China joint venture, Biohit HealthCare (Hefei), was granted a China production license for its GastroPanel® products (see story). GastroPanel is a non-invasive test for low levels of acid in the stomach, a risk factor for gastric cancer. Low levels of stomach acid can be caused by H. pylori infection or dysfunction of the stomach mucosa (atrophic gastritis). The JV is 60% owned by China's Wisdom-Win. 

Disclosure: none.


 

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