Deals and Financings

Everest Medicines II of Shanghai, a company backed by C-Bridge Capital, agreed to pay up to $835 million in upfront and milestone payments for Greater China rights to an Immunomedics (NSDQ: IMMU) antibody-drug conjugate (ADC) (see story). Sacituzumab govitecan, a clinical stage candidate, is aimed at solid tumor cancers. Everest will make a $65 million upfront payment and will pay an additional $60 million if sacituzumab govitecan is approved in the US to treat triple-negative breast cancer. Everest Medicines said the agreement is a record-setting deal for Greater China rights to a single agent.

Viva Biotech, a Shanghai CRO that includes partnering as part of its business plan, will seek to raise $194 million in a Hong Kong IPO that values the company at $750 million (see story). Viva is a structure-based, integrated drug discovery CRO. For selected clients, Viva offers a Equity for Services model that provides clients about $1.5 million in either cash or services in return for equity. Viva expects to hold half the equity for about 2.5 years and the rest for 5.5 years. So far, it has earned returns of between 200% and 500% on five closed investments.

Digital China Health Technologies participated in a $17.1 million extension of a Congenica Series B funding that has now raised a total of $30 million (see story). Congenica, a UK company, is developing the next generation of its Sapientia™ platform, an AI decision support system for genomics used to identify rare diseases and provide cancer management. Last year, DCHealth acquired rights to promote the Sapientia platform in China. DCHealth is the healthcare subsidiary of Digital China Holdings (HK: 00861, a major China IT company.

Tot Biopharm, a Suzhou oncology company backed by Chengwei Capital, filed to IPO on the Hong Kong Exchange (see story). The company has developed a portfolio of more than ten candidates including three biologics and three small molecule drugs that are approved to conduct China clinical trials. Founded in 2010, Tot has raised a total of $108 million, most of which was a $102 million Series B funding, completed in 2018 and led by 99 Fund and China Universal.

Shanghai's QTC Care, an international healthcare platform, raised $7 million in a series A funding led by Tencent (see story). QTC says its mission is to insure its members have access to qualified doctors around the globe. The company uses AI to streamline treatment and prevent disease. Established in the US in 2013, QTC is now headquartered in Shanghai with branches in major China cities, the US, Japan and Singapore. Because Tencent is building a healthcare portal, it is a very active healthcare investor. Last week, its Trusted Doctor subsidiary raised $250 million.

Luye Pharma (HK: 2186) in-licensed greater China rights to PharmaMar's (MSE: PHM) lurbinectedin (Zepsyre®) as a treatment for small cell lung cancer (SCLC) (see story). Luye will make an up-front payment of $5 million followed by additional regulatory and sales milestones, as well as double-digit royalties. If lurbinectedin is approved for other indications, Luye will make additional payments. Lurbinectedin is an inhibitor of RNA polymerase II, which is essential for the transcription process. PharmaMar, a Madrid biopharma, is developing the drug in tumors with transcription addiction.

Suzhou's CStone Pharma (HK: 2616) acquired Greater China rights to a tri-specific PD-L1 antibody developed by Zurich's Numab in exchange for funding R&D of the molecule through a Phase I clinical trial (see story). ND021 is a late-preclinical molecule that targets PD-L1, 4-1BB, and human serum albumin (HSA). Because it activates T cells only when binding PD-L1 on tumor cells, ND021 is expected to avoid the liver toxicities of other 4-1BB-agonistic antibodies. CStone notes that once the Phase Ib trial is completed, it will have no other financial obligations for ND021.

IPO News

Just over one year ago, the Hong Kong Stock Exchange announced its brand new IPO pathway for "pre-revenue" China biopharmas (see story). Since then, seven biopharmas have completed IPOs under the new rules, and the results tell a tale of two quite different markets: the first three lost money for their IPO investors while the last four generated very attractive returns -- three of the last four are now more than 65% higher than their IPO prices. It isn't really two different markets; it only seems that way. We look into what changed. [Editor's Note: A panel on Capital Markets at the ChinaBio Partnering Forum in Shanghai on May 8-9 will feature some of these companies as panelists.]

Trials and Approvals

I-Mab Biopharma of Shanghai has begun a randomized multi-center Phase III clinical trial in Taiwan and China to evaluate a human CD38 antibody in combination with Revlimid in patients with relapsed or refractory multiple myeloma (see story). Revlimid is commonly used to treat multiple myeloma. In 2017, I-Mab in-licensed rights to the CD38 antibody from MorphoSys AG (FSE/NSDQ: MOR) in a $120 million agreement. One month ago, I-Mab announced it was starting Taiwan Phase II trials of the CD38 antibody as a single agent in multiple myeloma.

Ascletis (HK: 1672) of Hangzhou and San Francisco's 3-V Biosciences have started a US-China Phase II clinical trial of their partnered treatment for non-alcoholic steatohepatitis (NASH) (see story). Ascletis acquired China rights to TVB-2640/ASC40, a fatty acid synthase (FASN) inhibitor, earlier this year when it led a $18 Series E financing in 3-V Biosciences. The trial will evaluate the candidate in about 90 US NASH and 25-30 China NASH patients. Ascletis focuses on liver diseases with several approved treatments for hepatitis C.

Shanghai's Sinovant Sciences was given the go-ahead to begin a China registrational trials of derazantinib as a second-line treatment for intrahepatic cholangiocarcinoma (bile duct cancer) (see story). Derazantinib is an oral pan-FGFR (fibroblast growth factor receptor) inhibitor being developed to treat iCCA and other tumors with high FGFR mutation rates. Roivant, Sinovant's parent, in-licensed China rights to derazantinib from ArQule (NSDQ: ARQL) in 2018, and then included it in a package of 11 drugs sent to Sinovant for China development.

Disclosures: none.