Week In Review: Qiming Closes $3.2 Billion For China Healthcare And Technology Investments

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Deals and Financings

Qiming Venture Partners closed two new China healthcare and technology funds with $3.2 billion in fresh capital, both of them at their hard cap limits. The USD Fund VIII has $2.5 billion and the first round of RMB Fund VII closed at RMB 4.7 billion ($700 million) (see story). Since being founded in 2006, Qiming has backed over 480 companies, which include 70 that have unicorn status and 180 with exits. Over the last three months, China’s life science VCs have reported the following capital raises: OrbiMed – $1.1 billion; Vivo – $600 million; Sequoia – $9 billion.

Sinopharm (OTCPK:SHTDF), China’s large state-owned biopharmaceutical company, may make a $1 billion bid to acquire BBI Life Sciences (OTC:BBSCF), a Shanghai company that offers products for research science. The acquisition process is in an early stage and includes several other interested bidders. BBI offers raw materials and consumables for life science research, as well as for the food and agriculture industries. BBI IPO’d in 2014 on the Hong Kong Exchange, but in 2020, its major owners, the Wang family, took the company private again. Sinopharm uses M&A and venture investments to expand its portfolio.

Epic Bio of South San Francisco completed a $55 million Series A round to develop ultracompact therapies that modulate gene expression in vivo. The funding was led by Hong Kong’s Horizon Ventures, which has backed several gene editing companies. Epic has developed the GEMS (Gene Expression Modulation System) platform to turn gene expression on and off. It also licensed rights to the ultracompact DNA-binding protein CasMINI for human use. CasMINI is the smallest Cas protein created to date, developed in the Stanford lab of Stanley Qi, PhD, the founder of Epic.

Tianjin Tasly Pharma formed a JV with Mauna Kea Technologies of Paris for China commercialization of Mauna Kea’s Cellvizio®, a needle-based confocal laser endomicroscopy platform. The platform offers probes for medical applications in gastroenterology, pulmonology and urology. The JV will also direct global commercialization of the platform for neurology and neurosurgery, and it will manufacture Cellvizio units for the China market. Mauna Kea will receive $10 million in cash, a 44% equity interest in the JV, and a 5-year commitment to purchase minimum quantities of Cellvizio systems and probes.

CStone Pharma (OTCPK:CSPHF) of Suzhou is reported to be exploring strategic options for the company, which could include sale of the entire company or a majority stake, according to a report from Bloomberg News. The company reported working capital of US$130 million at 2021 year-end, almost two-thirds lower than the year earlier. CStone in-licenses drugs for China use and develops its own products. The company is at the awkward stage when the number of clinical trials is high, but revenues from approved drug isn’t keeping pace. The Bloomberg report said CStone has hired Goldman Sachs to analyze its options.

Triastek, a Nanjing 3D printing company, will collaborate with Eli Lilly (LLY) to apply 3D printing that creates precisely targeted drugs with programmed release in specific areas of the GI tract (see story). Triastek must first examine excipient properties and process parameters to maintain drug stability throughout the manufacturing and delivery processes. Then it will create a three-dimensional structure that releases the drug in different parts of the intestine with a goal of improving the bioavailability of oral drugs. The two companies did not disclose any specific Lilly drugs that Triastek will develop.

Trials and Approvals

Suzhou CStone Pharma announced that Gavreto® (pralsetinib) was approved in Hong Kong to treat adult patients with RET fusion-positive metastatic NSCLC (see story). Gavreto, a once daily oral selective RET inhibitor, is already approved in Mainland China and Hong Kong for other RET NSCLC and thyroid cancer indications. In 2018, CStone acquired China rights to the drug from Boston’s Blueprint Medicines (BPMC) in a deal worth up to $386 million. According to CStone, RET fusions account for 1-2% of all NSCLC patients, the majority of whom are non-smokers.

Guangzhou Bio-Thera Solutions has begun dosing advanced solid tumor patients in a Phase 1 clinical trial of BAT8006, an antibody drug conjugate (ADC) targeting folic acid receptor α (FRα). BAT8006 uses Bio-Thera’s anti-FRα antibody and its ADC linker-payload combination that includes a cleavable linker and a small molecule topoisomerase I inhibitor. BAT8006 is the first candidate from Bio-Thera’s proprietary new ADC platform to start trials. Bio-Thera has six candidates in late-stage clinical trials and has two approved products, plus candidates for immuno-oncology, ADC targeted therapies and autoimmune diseases.

Connect Biopharma (CNTB) will conduct a primary analysis of its lead drug as a therapy for atopic dermatitis, based on the first 255 patients already enrolled in the China Phase III trial. China’s CDE told the company the 255 patients would be enough for a preliminary efficacy review. The company now plans to report top-line results by the end of 2022. Connect’s CBP-201 targets interleukin-4 receptor alpha (IL-4Rα). Connect must still complete the second Phase of the trial, but the early read-out on Phase I could speed up China approval to 2025.

Overland ADCT BioPharma, a JV created by Overland Pharma and Lausanne’s ADC Therapeutics, dosed the first patient in a China trial of Zynlonta® as a therapy for transfer-ineligible patients with diffuse large B-cell lymphoma (DLBCL). Overland Pharma, backed by Beijing’s Hillhouse Capital, is a Boston-Shanghai pharma that uses partnerships to bring novel medicines to Asia. Three months ago, Zynlonta was the first CD19 ADC approved in the US. The JV will join a global Zynlonta Phase III trial as a second-line therapy in the US and China for transplant-ineligible patients.

Disclosure: none.

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Editor’s Note: The summary bullets for this article were chosen by Seeking Alpha editors.

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