China Biotech Week in Review: Pharmaron Raises $40 Million in Venture Capital

Includes: BJGP, SNY
by: ChinaBio Today

Pharmaron Holding Limited, a Beijing CRO, closed a Series C financing round totaling over $40 million (see story). Pharmaron will use the new capital to strengthen and expand its drug discovery services offerings, preclinical GLP toxicology capabilities and GMP chemical synthesis services. Pharmaron has five preclinical facilities in Beijing, with a GMP Pilot Plant currently under construction.

Zhejiang Jolly Pharmaceutical (SHE: 300181) completed its ChiNext IPO, raising $71.5 million (see story). The company issued 20 million shares at 23.5 RMB ($3.57) per share, a price-earnings ratio of 61. The offering was well-received and traded higher in the opening market, rising 20% to 28.18 RMB ($4.29).

Zhejiang Hisoar Pharmaceutical (SHE: 002099) raised $79 million in a private placement, issuing 25 million shares at $3.18 each (see story). Hisoar’s Chairman, Li Wei, will buy at least 10% of the offering. The great majority of the proceeds is earmarked for two major capital projects. Hisoar said the projects will add around $182.5 million in annual sales, once they are completed.

Sanofi-Aventis (NYSE: SNY) closed its acquisition of BMP Sunstone (NASDAQ: BJGP), a transaction originally announced in October 2010 (see story). Sanofi is paying $520.6 million, or $10 per share. The acquisition gives Sanofi added presence in the China consumer healthcare market and an established distribution network. Sunstone was originally a distribution company that became a producer of healthcare products through M&A.

Shanghai Pharmaceutical (SHA: 601607) is expected to announce it is buying a large stake in German drug distributor Celesio AG, according to press reports (see story). Shanghai Pharma will purchase the stake from Franz Haniel & Cie GmbH, an investment company with financial problems that has been shopping the shares for a year. Although the price of the transaction was not leaked, it was noted that Haniel owns a 54.6% stake in Celesio.

Government Policy

The PRC is drawing up a plan to invest 5 billion RMB ($761 million) in API manufacturers, with the goal of raising the country’s export value of API products by $4 billion annually (see story). The plan remains unofficial at the moment, though the Shanghai Securities News reports it will be released in the first half of 2011.

The FDA plans to increase its use of outsourcing to perform inspections of foreign drug manufacturers (see story). The US Congress is demanding more rigorous oversight of drugs coming into the US, but the FDA does not have the staff to perform the job by itself. As the US increases its dependence on foreign sources for drugs, the problem has become more critical.


Biomics Biotechnologies of Nantong and Benitec Limited of Australia agreed to advance their hepatitis B anti-viral collaboration into in vivo pre-clinical studies (see story). The two companies are seeking to identify an RNA interference (RNAi) treatment for hepatitis B. Both companies are RNAi specialists.

Disclosure: none.