China Biotech Week in Review

Includes: CRL, JNJ, RHGP, WX
by: ChinaBio Today

Trauson (Jiangsu) Holdings Company Limited, one of mainland China’s largest orthopedic products companies, will IPO on the Hong Kong Exchange (see story). The company hopes to raise as much as HK $760 million ($98 million), which it will use to upgrade its manufacturing facilities and provide capital for M&A activities.

Shandong Lukang Pharmaceutical (SHEX: 600789) will invest 3.5 billion RMB ($514 million) to build a biomedical park in Shandong province (see story). Construction of the Lukang Zoucheng biomedical industrial park will continue for five years. The local government will provide the land and other incentives, according to a release from the company.

Charles River Labs’ (NYSE: CRL) spectacular announcement that it intends to acquire China’s most visible CRO, WuXi PharmaTech (NYSE: WX), has already drawn criticism over the price, $1.6 billion (see story). Now an analyst is making the case that another, perhaps more significant, roadblock exists that may derail the proposed transaction: approval of the deal from China’s government.

Jiangsu Kanion Pharmaceutical (SHEX: 600557) will add an additional 33% stake in Jiangsu Nanxing Pharmaceutical to its existing 30% holding in the company, giving it 63% ownership and majority control (see story). Kanion is buying the shares from Lianyungang Jiandian Technology for 81.4 million RMB ($12 million). Both companies are involved in producing TCM products.

According to the Economic Observer, a China-based weekly business publication, the most recent SFDA bribery scandal involves the Shanghai branch of Johnson & Johnson (NYSE: JNJ) (see story). So far, there has been no official confirmation of the allegation. Johnson & Johnson refused to comment on the matter.

Stallergenes S.A. announced positive results from a China Phase III clinical trial that tested Staloral 300 in adult patients with asthma triggered by dust mites (see story). The French company will use the results to support an application for SFDA approval of its drug, a sublingual immunotherapy. It will also conduct a similar trial of another drug, Actair, in a slightly different population: patients whose rhinitis is triggered by dust mites.

Cellonis Biotechnologies Group, located in Beijing, reported that its autologous stem cell therapy has successfully treated patients with diabetes (see story). The therapy uses stem cells harvested from a patient’s bone marrow. Cellonis claims that, in the best case, the treatment restores a patient’s natural ability to produce insulin and has also reversed complications from diabetes, such as kidney failure.

Renhuang Pharmaceuticals (OTC:RHGP) will launch Schisandra Tablets, a natural anti-depressant, in July (see story). The company expects the new product to generate revenues of 3 million RMB ($440,000) in fiscal year 2010 and 10 million RMB ($1.5 million) in 2011. Schisandra, also known as magnolia vine, is a TCM used to treat a variety of ailments, including neurasthenia.

Disclosure: none.