China Biotech in Review: VCs Invest $1 Billion in China Life Science During 2010

Includes: HSP, LLY, SVA
by: ChinaBio Today

In 2010, life science VC investing in China climbed an astonishing 319% to break $1 billion (see story). By contrast, venture capital investing in the United States’ life science was flat compared to 2009 levels, showing a dramatic switch in the world’s perceptions of where the future lies for biomedical companies.

China will build a $300 million institute as its contribution to the Human Variome Project, a worldwide study of human genetic variation and the diseases it causes (see story). The $300 million commitment dwarfs contributions from other countries – the project has a budget of just $12 million for each of its first five years. The PRC will also contribute an additional $20 million over 10 years to assist global coordinating activities.

Partnerships and M&A

Yabao Pharmaceuticals Group (SHA: 600351) of Beijing has signed a $50 million strategic collaboration agreement with Frontage Laboratories of Pennsylvania (see story). Over the next five years, the two companies plan to develop sustained release delivery for more than 20 products, then submit them for approval in the US and Europe.

START (South Texas Accelerated Research Therapeutics) announced a joint venture that will open a Phase I clinical trial facility specifically for cancer patients in Fudan University Shanghai Cancer Center (see story). START’s partner in the initiative is Cenova Ventures, an RMB venture capital firm with backing from both national and local government.

Jiangsu Aosaikang Pharmaceutical (ASK) of Nanjing purchased a 5% stake in a New Zealand pharma, Living Cell Technologies, for $1.7 million (see story). LCT’s major product, Diabecell, is a technology that implants encapsulated islet cells from pigs into the livers of diabetic patients. The product is in a Phase II clinical trial in New Zealand. As part of the investment, ASK will have an option on China rights to the technology.

Clinical Trials

Hutchison MediPharma, the drug discovery arm of Chi-Med [AIM: HCM], has begun a Phase I trial of its second anti-angiogenesis cancer drug candidate, fruquintinib (see story). The first molecule, sulfatinib (HMPL-012), began clinical trials in April of 2010. According to Hutchison, fruquintinib showed “potent” anti-angiogenesis activity in pre-clinical testing.

Sinovac Biotech (NSDQ: SVA) submitted a request to the SFDA to conduct a clinical trial of its newly developed 23-valent and 24-valent pneumococcal polysaccharides vaccines (PPV) (see story). The vaccines are designed to protect against pneumonia, meningitis and febrile bacteremia along with sinusitis and bronchitis.

Distribution and China Development Rights

Avacta Group plc [AIM: AVTG], a UK company that makes a laser drug discovery analysis machine, has signed a distribution agreement with Cold Spring Biotech Corp of Taiwan (see story). Cold Spring will distribute Avacta’s Optim machines in the PRC, Hong Kong and Taiwan.

Tacere Therapeutics of California said it reacquired Asian rights to its RNA interference candidates for hepatitis C infection from Oncolys BioPharma in Japan (see story). Tacere announced the move immediately after Pfizer (NYSE: PFE) exercised its option to continue R&D of the company’s RNAi hepatitis drugs for ex-Asian markets.

Patent Dispute

Eli Lilly (NYSE: LLY) has filed suit against Hospira Inc. (NYSE: HSP), seeking to block the company from selling a generic version of its cancer drug Gemzar (see story). The generic Gemzar is made in China by Jiangsu Hansoh Pharmaceutical Co. Ltd. According to Lilly, the generic drug violates one of its Gemzar patents.

Disclosure: none.