Deals and Financings
Chindex (NSDQ: CHDX), the US-based operator of China hospitals and clinics, received a new takeover offer of $23 per share from an undisclosed entity (see story). The offer is an 18% improvement on the $19.50 bid, made in February, from a group comprised of Fosun Pharma (SHA: 600196; HK: 2196, TPG (a US private equity group) and Roberta Lipson, CEO of Chindex. A definitive agreement has been negotiated with the entity behind the latest offer, which is all-cash and not subject to any financing contingencies.
Guangxi Wuzhou Zhongheng Group [SHA: 600252] will establish a pharma M&A fund with partners that could be as large as $162 million. The partners are Wuzhou Zhongheng's largest shareholder, Guangxi Zhongheng Industrial, plus Beijing Sensegain Investment and other limited partners. Each partner will contribute a specified proportion once a suitable pharmaceutical investment is identified. The specific proportion is 29% by Zhongheng, 20% by Zhongheng Industrial, and 51% by Sensegain and other investors.
Changchun BCHT Biotechnology signed a long-term collaboration and licensing deal with Dutch vaccine company Mucosis, The agreement is part of a $6.9 million funding round for Mucosis, in which BCHT participated. For its investment, BCHT received a China license to Mucosis' SynGEM® prefusion F vaccine candidate for RSV and its Mimopath® platform for other disease targets. In addition to the equity investment, BCHT will also make "customary" payments including royalties.
Techne (NSDQ: TECH) will acquire Shanghai PrimeGene Bio-Tech, a company that makes recombinant proteins for research and diagnostic applications (see story). Techne is a US company that offers research proteins in China through a subsidiary, R&D Systems China, which will be the purchaser. Techne said the purchase will add China manufacturing capacity and over 400 new protein products to its portfolio.
Dr. Steve Yang joined WuXi PharmaTech (NYSE: WX) as Chief Operating Officer (see story). Dr. Yang's high-profile background combines deep knowledge of biopharma R&D in China and global pharma experience. For the past three years, he has been Vice President and Head of Asia and Emerging Markets iMed at AstraZeneca (NYSE: AZN), based in Shanghai. Before that, he spent 10 years at Pfizer (NYSE: PFE), also in Shanghai, as head of Asia R&D. Dr. Yang is a co-founder of BayHelix, an elite group of China-American biopharma executives and one of the returnees or "sea turtles" who is changing the face of the pharmaceutical industry in China.
Johnson & Johnson (NYSE: JNJ) broke ground on a $300 million facility in the Xi'an High-tech Development Zone (see story). For J&J, the new facility is its biggest single investment in a plant and its largest production facility (2.9 million square feet). It will house an innovation center for J&J's Asian supply chain, the largest production capacity for vaccines in Asia, and a registration center for foreign biomedical projects. Construction will be completed in 2018.
Zhejiang Hisun Pharma [SHA: 600267] signed an agreement with Catalent Pharma Solutions of the US under which Catalent will provide Hisun with biosimilar cell lines. Hisun will use the technology to produce biosimilars of well-known biologics, including two arthritis treatments, Remicade and Humira, plus a treatment for leukemia, Campath. According to Catalent, its GPEx® technology reduces development time by two-thirds.
Government and Regulatory
China will amend its policy of putting price limits on Essential Drug List products - though it isn't clear how far-reaching the policy change will be. The prices for some drugs will be allowed to fluctuate, as long as they stay within a specified range. The National Health and Family Planning Commission, which quietly posted the announcement on its website, did not explain which drugs were involved, nor did it specify their expected range. The move is an apparent reaction to shortages of commonly used, inexpensive drugs in China, especially Tapazole, a treatment for hyperthyroidism.